LIVE MARKETS-Main US stock futures edge green after jobs data

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MAIN U.S. STOCK FUTURES EDGE GREEN AFTER JOBS DATA

The main U.S. equity index futures have turned slightly green after the release of the latest data on U.S. employment. E-mini S&P 500 futures EScv1 are now up around 0.14% vs a loss of around 0.1% just before the data came out.

The November non-farm payroll headline jobs number came in at 227k vs a 200k estimate, according to LSEG. Of note, the prior headline jobs read for October was revised up to 36k from 12k.

The unemployment rate came in at 4.2% vs a 4.2% estimate.

Wage data, on a month-over-month and year-over-year basis, came in hotter than expected:

According to the CME's FedWatch Tool, the probability that the Fed cuts rates by 25 basis points (bps) at its December 17-18 meeting has increased to around 90% from 68% just before the data was released. The chance that the FOMC leaves rates unchanged is now around 10% down from 32%.

Looking forward to the January 28-29 FOMC meeting, the FedWatch Tool is still showing a bias for rates to be in the 4.25%-4.50% area vs the current target rate of 4.50%-4.75%. Conviction in that bias has increased and it now stands at 69% vs 58% just before the data.

The U.S. 10-Year Treasury Yield US10YT=RR is now around 4.15%. It was around 4.17% just before the numbers came out. The yield ended Thursday at 4.182%.

Most S&P 500 index .SPX sector SPDR ETFs are quoted higher in premarket trade with consumer discretionary XLY.P, up around 0.9%, posting the biggest rise. Energy XLE.P is off slightly.

The SPDR S&P regional banking ETF KRE.P is up just over 1%.

Regarding the jobs data, Paul Christopher, head of global investment strategy at the Wells Fargo Investment Institute, said:

"This is a pretty much in line report. What caught our eye was the tick higher in earnings. That's going to help the economy remain strong heading into the new year. Markets would've been looking for any sign of weakness."

Christopher added "It probably cements the Fed with another quarter point cut in December. The jobs number is not particularly outrageously strong. It's more in line with averages."

December U Mich preliminary sentiment is due at 1000 EST. The estimate is for 73 vs 71.8 last month.

Here is a premarket snapshot:

(Terence Gabriel, Sinéad Carew)

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