July payrolls fell 23,000, far short of the 83,000 forecast, and wage growth cooled to 3.2%, shifting bets on Fed policy. September hike odds slid to 44%.
Alpha Score of 62 reflects moderate overall profile with moderate momentum, weak value, strong quality, moderate sentiment.
The U.S. economy shed 23,000 jobs in July, the Bureau of Labor Statistics reported Friday, against a Dow Jones consensus forecast of an 83,000 gain.
June's payroll count was revised down to 20,000, and May to 63,000, 66,000 below the prior estimate. Those revisions brought the 12-month average gain down to 34,000.
Local government education accounted for the largest share of the July decline, down 50,000 jobs. Retail lost 19,000 and financial activities 14,000. Healthcare, the leading sector for job creation, added 22,000, below its 12-month average of 36,000.
Pay gains stalled. Average hourly earnings rose 2 cents, leaving the 12-month increase at 3.2%, below the 3.5% forecast.
Unemployment slipped to 4.1%, and the labor force participation rate fell further, to 61.4%, its lowest in more than five years. A shrinking labor force, not new hiring, accounted for the decline.
Federal Reserve policymakers remain split on the next move. September is the next scheduled policy meeting; last week the Federal Open Market Committee voted 9-3 to hold its benchmark rate in place. Several officials have spoken in favor of raising rates as soon as September if the pace of price increases does not ease. Inflation remains well above the central bank's 2% target, and Friday's data showed the employment picture slowing after the labor market had begun to improve from a moribund 2025.
Fed funds futures traders shifted their bets after the report. Odds for a September move fell to 44%, and for October to 58.3%, according to the CME Group's FedWatch gauge of futures prices. CME Group, which operates the gauge, carries an Alpha Score of 56, a Moderate reading.
Stock futures turned higher on expectations for a more dovish Fed. Futures tied to the Dow Jones Industrial Average climbed close to 200 points, and Treasury yields fell sharply after hovering near the flatline earlier in the session.
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