The U.S. Economy added 273,000 jobs in February versus expectations for 175,000, but the data offered markets no reprieve from the recent selloff. The major indexes fell for the second day in a row. The week started out with an impressive rebound, with the Dow surging over 5%, but the rest of the week was skewed to the downside in very volatile trading. Global equities joined the U.S. in finishing lower. Treasury yields set another round of record lows on the long end of the curve with the yield on the 10-year note falling all the way to 0.66%, before recovering a bit. The dollar has suffered from the lower rates and certainly continued to today. Crude oil fell and gold prices were higher. Costco posted better-than-expected quarterly results. Dow member JPMorgan was in focus after CEO Jamie Dimon underwent emergency heart surgery. Starbucks warned the company expects Chinese same-store sales to tumble 50% in Q2.

The Dow Jones Industrial Average lost 256 points (1.0%) to 25,865, the S&P 500 lost 52 points (1.7%) to 2,972 and the NASDAQ lost 163 points (1.9%) to 8,576. In heavy volume, 1.6 billion shares were traded on the NYSE and 4.3 billion shares changed hands on the NASDAQ. WTI oil lost $4.62 to $41.28 per barrel and wholesale gasoline was down $0.13 to $1.39 per gallon. Elsewhere, the Bloomberg gold spot price was up $4.40 to $1,672.40 per ounce. The Dollar Index—a comparison of the U.S. dollar to six major world currencies—dropped 0.8% to 96.02. For the week, the Dow was up 1.8%, the S&P rose 0.6% and the NASDAQ added 0.1%.

Nonfarm payrolls rose by 273,000 jobs month-over-month (m/m) in February, compared to the Bloomberg forecast of a 175,000 increase. The rise of 225,000 seen in January was revised to a gain of 273,000 jobs. Excluding government hiring and firing, private sector payrolls increased by 228,000, versus the forecasted gain of 160,000, after rising by 222,000 in January, which was revised from the 206,000 increase that was initially reported. Notable job gains occurred in health care and social assistance, food services and drinking places, government, construction, professional and technical services, and financial activities. The upward revision to the prior two months was 85,000. The labor force participation rate remained at January’s 63.4% rate.

The unemployment rate dipped to 3.5% from January’s 3.6% rate, where it was forecasted to remain, while average hourly earnings were up 0.3% m/m, matching projections and compared to January’s unrevised 0.2% gain. Y/Y, wage gains were 3.0% higher, in line with estimates. Finally, average weekly hours ticked higher to 34.4 from January’s 34.3, where it was expected to remain.

The trade balance showed that the January deficit narrowed more than expected, coming in at $45.3 billion versus estimates of $46.1 billion. December’s deficit was revised to a shortfall of $48.6 billion from the originally-reported $48.9 billion.

January wholesale inventories were revised lower to a 0.4% m/m decline, versus expectations to remain at the preliminary estimate of a 0.2% dip, and compared to December’s unrevised 0.3% decrease. Sales were up 1.6%, following December’s favorably-revised 0.2% decrease.

Consumer credit was projected to show borrowing came in at $16.5 billion for January, down from the $22.1 billion posted in December, but ultimately showed a much steeper decline down to $12.0 billion.

Treasuries continued to surge, with the yield on the 2-year note falling 8 basis points (bps) to 0.52%, the yield on the 10-year note dropping 13 bps to 0.78%, and the 30-year bond rate tumbling 23 bps to 1.31%. Bond yields extended a recent plunge to fresh record lows as the coronavirus concerns foster a decisive flight to safety, and the U.S. dollar also fell as the global markets grapple with the outbreak and central bank stimulus measures that included this week’s surprising 50 bp rate cut from the Fed with expectations rising that the Central Bank may cut by another 50 bps at its scheduled meeting later this month.

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