Economic expectations not met, stock market reacts
With analysts and economists invariably incorrect in their reported expectations of important data, I must reiterate how it’s better to keep your mouth shut and be considered ignorant, than to open it and remove all doubt. The incorrect expectations of the employment numbers prompted a market action that, upon issuance of the actual report, caused a reaction.
Prior to last week’s report on job creation, the expectation was for 190,000 to 200,000. When the actual number was issued for only 88,000 jobs, the U.S. equity markets sold off sharply and the government bond yields declined dramatically, pushing bond prices sharply higher. This was all unnecessary had no expectation been issued and the market was allowed to disseminate the actual figures.
