PRODUCT PROFILE

Latest Dublin Prices

ISEQ ahead-US jobs data due today

Friday, November 02 08:51:16

The ISEQ is higher this morning at 3,291, up 9 points on yesterday's close as recent positive economic data has lifted sentiment however today's employment data from the US is seen as critical according to Davy Stockbrokers: The most closely watched US employment report in four years will be released later today (12.30), with market expectations heightened following better-than-expected ADP employment numbers yesterday. 158,000 private jobs were added to the labour force in October according to ADP, versus a consensus estimate of 140,000.

Within the numbers, the gains were broadly based, with a notable acceleration in construction employment of 23,000 in the month as well as sharp gains in the services sector. This trend in construction employment should continue given that construction spending has been ticking up in recent months - residential construction spending was up 2.8pc in September alone. Given the surprising upside to the ADP numbers, the official non-farms payrolls may have expanded at a faster rate than the 125,000 extra jobs expected in October, and the unemployment rate may also hold firm at 7.8pc rather than rise as expected to 7.9pc. But 125,000 is still a decent improvement on the anaemic 114,000 jobs added in September.

With 30pc of tax revenues due in Q4, Irish exchequer returns (16.30) will be watched closely for any slippage in revenues in October. Year-to-date, tax revenues are ahead 1.5pc but income tax receipts have fallen behind on a monthly basis since July, masked by the decent start to the year, leaving receipts up marginally on expectations. E2.5bn in taxes is expected in October, with E4bn in spending in the month. Spending is above budget by E606m, largely on overspends in health and social protection, and this is unlikely to be rowed back on fully before year-end according to Davy Stockbrokers.