Private-sector hiring slows in April, stirs concern

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By ManiKrishnan Zurich

The S&P 500 and the Dow edged lower on Wednesday 02/05 as data showed hiring fell far more than expected in April, sparking concerns that Friday’s U.S. jobs report will also disappoint investors. Private employers added 119,000 jobs in April, well short of the 177,000 expected,

If payrolls come in higher than expected and the unemployment rate falls, it’s likely that equity markets and the U.S. dollar would rally on ideas the U.S. economy is showing growth. Gold would likely slip because the possibility of more monetary stimulus from the Federal Reserve.

If payrolls data comes in lower than expected,  weaker equities because of lower growth prospects. USD may rally on safe-haven flows.  A poor jobs report means a greater chance of stimulus from the Fed.  Equities could rally with gold. USD may weaken.

AUSSIE fortunes rested heavily on commodity prices and China’s growth prospects. When both of those factors were strong, so was the Aussie.

The outlook for China has dimmed somewhat, and a recent upward move in commodity prices has left the Australian dollar cold. The Reserve Bank of Australia’s larger-than-expected interest rate cut earlier this week only added to the Aussie’s troubles.

The 17 countries that use the euro are facing the highest unemployment rates in the history of the currency as recession once again spreads across Europe, pressuring leaders to focus less on austerity and more on stimulating growth.

02/05 The euro fell back below the $1.32 level and the dollar strengthened across the board as data showed a sharp contraction in eurozone manufacturing output, adding to fears over the economic stability of the region.

German manufacturing output fell for the first time since December, increasing concerns that the eurozone’s economic problems were affecting core countries as well as peripheral nations.