Archived IMT (2010.09.03)

MARKETS CHEER AUG US JOBS REPORT as payrolls fall by smaller than expected 54K and the unemp rate rises to 9.6%. More striking is the July figure was revised down to -54K from -131K, while the private payrolls rose by 67K vs exp 41K following 107K in July, which was revised from 71K. JPY is the biggest loser as risk appetite erupts across the board, with the USD attempting to trim down EURs gains but USDCAD is falling relentlessly (by 130 pips), eyeing 1.0380, followed by 1.0320. CAD is favoured by the fact that US stabilization will help Canada, especially since BoC rates remain below 1%. EURUSD hit the key $1.2870 resistance (1.2870), which is likely to stand in the way of any extension past $1.29. MARKETS TURN TO US AUG SERVICES ISM seen at 53.5 from 54.3. Attention will be paid to the new orders (prev 56.7 from 54.4) and employment index (prev 50.9 from 49.7). As long as the headline reading is above 52, markets are likely to extend their run-up, with currencies punishing the yen.