Market Drivers – US Session, February 2

Gold is -0.85% down, trading around $2037 per ounce at the time of writing, obviously impacted by the rallying US dollar following surprise NFP reading on Friday.

European equities gained after the US Nonfarm Payrolls reached a one-year high, pushing investors further away from rate cut expectations. The pan-European STOXX600 index rose 0.02%, while France’s CAC40 gained 0.05%. Germany’s DAX index climbed 0.35%, ending the week at €16,918.21. London’s FTSE index shed nearly 7 points, ending Friday at £7,615.54.

EUR/JPY rose during Friday’s North American session, with buyers reclaiming the 160.00 figure on a risk-on impulse. US equities traded with solid gains, with cross-pair exchanges at 160.07.

The US dollar rose to 103.90 on Friday’s Dollar Index chart due to a promising labor market report, indicating a March rate cut is unlikely. Fed Chair Powell confirmed this, stating that the bank will monitor data to set the timing of the easing cycle, and as the US labor market remains tight, it might consider delaying rate cuts.


US Crude Oil fell into new lows on Friday due to geopolitical concerns and doubts about OPEC’s ability to under-produce growth in the non-OPEC sphere. Qatar is negotiating a ceasefire in Gaza, and its success in calming both sides of the conflict is causing crude oil to flounder.

OPEC faces a long-term challenge in 2024 and 2025 as non-OPEC producers like the US outstrip OPEC production caps. Analysts are concerned that the US and other non-OPEC producers could oversupply global markets, and investors will closely monitor inventories in 2024.

The S&P 500 reached a record high on Friday, with tech stocks like Meta gaining over 20% after their quarterly results exceeded expectations. The January jobs report also exceeded expectations, with the US economy adding 353,000 jobs in January, well above the Dow Jones estimate.

The rise in tech stocks helped shift investor focus from the jobs report. The report also included inflationary data, with wages expanding by 4.5% year over year. The S&P 500 added 1.4%, the Nasdaq Composite gained 1.1%, and the Dow rose 1.4%. This was the fourth consecutive week of gains for major benchmarks after a slump to start 2024.

Economic Data

US Nonfarm Payrolls (NFP) reached a 12-month high of 353,000 in January, considerably exceeding the market’s median projection of 180K. With the US economy continuing to demonstrate tenacious resilience and the US labour market remaining at record highs, the odds of a market-support rate cut from the Fed are decelerating.

Consumer sentiment in the United States has hit its highest point since July 2021, with consumers anticipating increases in both inflation and personal income.

According to the University of Michigan’s Surveys on Consumers, the index reached this level after a 13% month-over-month improvement in January, which was preceded by a 14% increase in December.

Also Read:
EUR/USD falls on stronger dollar following NFP data

Dollar advances as traders abandon rate cut hopes in March

Explainer: Why have commodities largely fluctuated in January?

USD/JPY surges to fresh highs post solid US jobs data

S&P 500, Nasdaq leap on soaring tech earnings including Meta

Consumer sentiment at highest level since July 2021

US dollar gets prepared for winning week post surprise NFP data