We're again late for this month, as it is currently 2:15am (ET) on Friday morning. However, we'd still like to post our Sept. NFP change guesstimate. Our model spit out an increase of approx. 200K in NFP for Sept., about 15K below the current consensus.
Some back to school related hiring in the beginning of September, may have been partially offset by layoffs in the leisure and hospitality spaces. ISM manufacturing employment sub-indexes were mixed. Although the services figure isn't out yet, we expect a slight increase. Lastly, the online indicators were a bit negative not just for the last part of September but also for October, as both total online job postings and new postings declined from last month.
With all of this said, again we expect a 200K increase in NFP, which is positive but still lower than expectations. Of course those BLS numbers are becoming more random every month. If they come in significantly above expectations, the equity market will likely react positively, but only for a short period, in our opinion. We continue to believe that the QE premium remains priced in, making the market overvalued, specially if it ends in Q1 next year.