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February jobs report

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February jobs report

March 01
22:42 2015

“Markets are looking for another robust jobs report, and bump up in (worker) wages, as a sign that the U.S. economy has escaped deflation and subpar growth of the past few years,” says Joe Quinlan, chief market strategist at U.S. Trust.US-unemployment-jobs-fair-007

The U.S. job-creation machine kicked off 2015 with robust gains. The economy produced a better-than-expected 257,000 new jobs in January, and the government also revised upwards job gains in the prior two months by 147,000. Another strong jobs report, Quinlan says, will underpin consumer confidence and spending going forward. It will also “cement” market expectations that the Federal Reserve, indeed, is going to raise interest rates later this year.

While fears of coming rate hikes could cause some market volatility, Wall Street will likely “grind through it,” Quinlan predicts. “The early stages of a Fed tightening cycle are bullish for equities. Why? Because growth is usually accelerating and profits remain strong,” he says.

Adds Tom Lee, managing partner at Fundstrat Global Advisors: “Labor markets have been solid, so continued momentum would be an affirmation of the consumer story. Moreover, with oil prices in decline and rig counts falling, investors worry about the fallout on labor markets — this is overstated, in general, since total jobs created in the energy sector the past six years is only 300,000.”