US private sector October job growth beats expectations
U.S. private employers added 43,000 jobs in October compared with a revised loss of 2,000 jobs in September, payrolls processor ADP Employer Services, which developed the report with Macroeconomic Advisers LLC, said on Wednesday. The September figure was originally reported as a loss of 39,000.
The October number came in well above expectations for a rise of 20,000 private-sector jobs, based on a median of estimates from 35 economists surveyed by Reuters.
It was the latest of some stronger-than-expected data on the U.S. economy, including Monday’s report showing surprisingly strong growth last month in the U.S. manufacturing sector, and among the last bits of data before Wednesday’s expected Federal Reserve announcement on monetary easing.
On Friday, the U.S. government is due to report its monthly jobs data, and the ADP is sometimes used by economists to update expectations for those numbers.
In the ADP data, “you have a net surprise of 60,000 or so, which is a meaningful amount and probably raises expectations at least at little bit for Friday’s employment report,” said Zach Pandl, economist, Nomura Securities in New York.
In Congressional elections on Tuesday, the Republican party won enough seats to regain control of the House of Representatives, with the nation’s high unemployment seen among voters’ top concerns.
U.S. stocks slightly extended gains after the ADP data, while U.S. Treasury debt prices slightly pared gains and the dollar rose against the euroand yen.
OTHER DATA MIXED ON WEDNESDAY
Separate data on Wednesday showed the number of planned layoffs at U.S. firms rose slightly in October, but the overall pace of downsizing for the year is down 62 percent from last year, a report said on Wednesday.
Employers announced 37,986 planned job cuts in October, up 2.2 percent from 37,151 cuts in September, according to the report from consultants Challenger, Gray & Christmas, Inc.
Also, data showed U.S. mortgage applications for home refinancing loans dropped for a third straight week even as interest rates held near-record lows.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, which includes purchase and refinance loans, decreased 5.0 percent for the week ended October 29. The four-week moving average, which smoothes the volatile weekly figures, was up 0.1 percent.
The Fed, in its announcement due on Wednesday, is expected to inject more money into the economy through bond purchases.
The central bank, which cut overnight interest rates to near zero in December 2008, has already bought about $1.7 trillion worth of Treasury and mortgage-related debt.