Commentary On June Jobs Report – Janus Henderson And ClearBridge

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HFA Staff
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Jobs Report

The following is a commentary from Greg Wilensky, Head of US Fixed Income and a portfolio manager at Janus Henderson Investors on today’s jobs report.

Greg Wilensky On Today’s Jobs Report

“Nonfarm payroll (NFP) data continues to show moderation in labor market strength, particularly when looking at private payrolls, but not too much softness.  The jobs numbers were modestly below expectations when factoring in the revisions but are still indicative of a healthy labor market.

This report absolutely keeps the probability of a September rate cut on the table.  This still seems like the most likely outcome.

This keeps the upcoming inflation data in the driver's seat for determining the timing of the first cut.  This NFP data will neither cause the Fed to take a September cut off the table or force them to cut rates in September even if the inflation data does not continue to show moderation that we have seen recently.

Signs of continued moderation of economic growth and the labor market will likely be a positive for equities and high yield bonds in, at least, the short run.

Clearly signs of continued moderation in the upcoming inflation data will be view positively by both stocks and bonds.

The market's pricing of 2 cuts in 2024 seems very reasonable.  We still believe the market is underpricing the number of cuts across 2025-2027.  As such, we still see room for the 5 year treasury yield to fall and like being overweight this part of the curve.”

A commentary by Jeff Schulze, Head of Economic and Market Strategy at ClearBridge Investments ($187.9 billion AUM), on this morning’s Jobs Report.

“The June jobs report further cements that the labor market is nearing equilibrium. This will further push the Fed to be more attentive to potential downside risks on the full employment side of the dual mandate than they have been over the past few years. Although the headline number was strong, the details were more mixed with large negative revisions to prior months that bring the 3-month average in job creation to 177,000, the slowest pace since January 2021. Just as one cool inflation print does not make a trend, neither does this one softer jobs report.

However, the combination of this morning’s data along with a grinding trend higher in jobless claims should bolster the case for the Fed to kick-off the long-awaited rate cutting cycle in September, which remains our base case. Today’s release should provide support for risk assets as Treasury yields across the curve are likely to see pressure despite thin holiday trading, as markets remain firmly in a “bad news is good news” environment.”


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