Jobs report in focus after concerning employment data

European markets are on track to close out the week on a more negative footing, after the decline in US equities took the Nasdaq to contraction territory. The German DAX reversed some of its recent gains, with the index falling over 1% in the wake of a January factory orders decline of 7%. Tariff fears remain prevalent despite Trump’s decision to postpone tariffs on autos and USMCA goods, with the US economy already showing signs of weakness according to the data released over the course of the week. The idea that you can repeatedly turn tariffs off and on without damaging economic activity has clearly run out of support, and businesses are likely to react by postponing investment until we have greater tariff clarity. In Europe, the 2 April deadline for reciprocal tariffs does provide the basis for concerns, although that can at least be counteracted by hopes that a sharp rise in government spending and the end to the Russia war will boost economic prospects.

Today’s US jobs report wraps up a week that has brought plenty of concern around the jobs market, with the simultaneous effects of tariff threats and the DOGE cutbacks adding up to provide a picture of economic weakness. The push to drive down government spending is a good thing given the spiralling debt, but that does come with potential disruption to the jobs data. This week has thus far seen a trio of employment contraction with the ISM manufacturing PMI, a 7-month low in the ADP payrolls, and the highest Challenger job cuts figure since July 2020. While markets are currently pointing towards an improved NFP figure and flat unemployment, could the data seen over the course of the week provide the basis for a disappointing jobs report later?

Bitcoin prices fell below $90,000 in the wake of Donald Trump’s executive order to establish a Strategic Bitcoin Reserve, maintaining the volatile and uncertain theme that has played out throughout the week. White House Crypto czar David Sacks confirmed that the reserve would be funded solely with bitcoin seized through criminal and civil forfeitures, disappointing those that had hoped for a raft of purchases on top of the $18 billion worth of BTC already held. While the decision to hold government funds in crypto does form an example for others to follow, the lack of purchases may also be something governments may also replicate in a bid to avoid looking like they are gambling with public funds. President Donald Trump is scheduled to host the inaugural White House Crypto Summit today, with regulation likely to be a central theme after years of harsh treatment from the SEC.