NFP smashes forecasts but wage growth slows; US500 surges higher

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 NFP employment change: 313k vs vs 205k exp and 239k prior
 Average earnings Y/Y: 2.6%  vs 2.8% exp
 US500 jumps sharply rallying over 20 points in last 15 minutes
 
What on the face of it could be described as a mixed report for the US has seen a clear market reaction for stocks with the US500 surging higher. The headline NFP employment change smashed expectations of a 205k print, coming in at 313k - the highest since the February 2015 release. What is more the previous reading was revised higher by 39k to 239k from 200k. 
 
NFPs followed the lead of ADP in rising strongly, with today’s release the highest in 2 years.
However, today’s release was never really going to be about the headline number as this has been a near constant source of strength in recent years. Rather wages was always likely to dominate this data point, especially considering the rise last time out. Average earnings Y/Y came in at 2.6%, below the 2.8% expected and this has seemingly had a bigger impact on the market. In addition last time’s average earnings was revised lower from its highest level since 2009 (+2.9%) to 2.8%. 
 
Wages fell back to 2.6% and whilst this is high historically speaking it is something of a disappointment.
The market reaction in the US dollar and Gold has been a little mixed, with a slight bit of weakness apparent in the Buck which seems to be focusing on the weaker earnings. One of the clearest move can be found in the US500 with stocks surging higher strongly. A lower earnings reading and strong headline could be seen to be win-win for stocks as it means it is unlikely the Fed will increase their number of hikes to 4 this year, whilst also showing a strengthening of the labour market. 
 
 The US500 has moved strongly higher following the release, rallying more than 20 points. The market is now at its highest level of the month and if it can take out 2764 then a retest of 2791 may lie ahead.