# May Jobs Report: A Data Breakdown with Jose Torres

## Метаданные

- **Канал:** Interactive Brokers
- **YouTube:** https://www.youtube.com/watch?v=NfsXOC-Ib0w
- **Дата:** 06.06.2026
- **Длительность:** 35:44
- **Просмотры:** 412

## Содержание

### [0:00](https://www.youtube.com/watch?v=NfsXOC-Ib0w) Segment 1 (00:00 - 05:00)

Morning everybody. Welcome to today's live stream event from Interactive Brokers. Here we're live on X and LinkedIn. Please send us your questions. We're going to be talking about the May Employment Report which is released at 8:30 Eastern time just in about 10 minutes from now. Delighted to uh welcome Jose Torres, Interactive Brokers, senior economist to the room. How are you Jose? — Good morning Andrew. Great to be here. doing well. Uh looking forward to a hotter than expected number. I think we're going to come in at 120 today. — 120,000. What's the um expectation on the street? — The expectation on the street is 85,000 unchanged unemployment rate of 4. 3%. — Why are you so bullish? You know, if you look at the real- time indicators and the uh more high frequency hiring numbers, you see that we we're seeing an inflection or we're seeing a reaceleration, more broadness in labor market strength and even other alternative labor reports. This week, we had job openings jolts 23-month high. We had ADP 16-month high. And this all occurs against the backdrop of worries that AI was going to in the near term potentially disrupt the labor market. And we're actually seeing the opposite. You know, we're seeing tons of headcount additions. I think a lot of it is motivated by the fact that a lot of the AI is expensive and firms are using it in conjunction with their labor teams to try to boost efficiencies. Uh and then another thing is that the AI adoption is really still in its early days across the real economy. It's yesterday in the challenger report we saw that technology and AI were responsible for uh about 40% of the job cut announcements in May. But all the other sectors you they don't really talk about it much. It's not really that significant of a factor. And for that reason, I think we're seeing the labor market begin to open up. We know that for the past few years, most of the gains were concentrated in health care and private education. And now we're I'm expecting to see some more strength in areas like construction, manufacturing, retail, leisure, hospitality, finance, professional business services, etc. So, uh, we'll see what happens at 8:30, but it appears that the a lot of the tailwinds from last year's passage of the big beautiful bill, the 100% depreciation in your first year on capital expenditures really providing meaningful tailwinds for this economy at this on at this juncture. Uh, the markets really caught that early. uh staging a 21% rally on the S& P 500 from the March 30 lows to the highs earlier this week. That all occurred while there was a Middle East war going on. While oil prices jumped north of $100, while interest rates were climbing significantly, we still got this monster rally off of the this AI buoyancy that was motivated by last year's passage of that legislation. Uh now however there is concerns that the price of the AI tools are rising and that the prosp the return prospects are turning back towards becoming uncertain. Uh, and we've had since the AI rally began back in 2023, we've had these periods of time where we're very bullish on AI and then we start worrying about its expense and its return profile in the medium and longer terms and then the AI trade takes a break like it did for example between January and March of this year and then a few months pass and then you know there there's another uh reason or justification to want to get bullish on AI that could be a new catalyst uh a new semiconductor from a particular firm. That could be a shortage in memory or in high grade computing uh pieces etc. So you know that's really the eb and flows of this growth that's been monumental. — How's um business confidence been in the last couple of months? Uh and then how about the same for consumers? Right. It's and we're seeing record low poll results for the president. Um and there just seems to me to be like a lack of uh [sighs] bullishness amongst the population. — Yeah. Um no in consumer confidence

### [5:00](https://www.youtube.com/watch?v=NfsXOC-Ib0w&t=300s) Segment 2 (05:00 - 10:00)

definitely there's no bullishness at all. It's very pessimistic. Of course the Fed has been allowing inflation to be above target Andrew since 2021. So, you know, you're at you're fif over five years now, well above target on inflation. Uh wages are now trailing inflation, which by the way is another reason why I think the labor market is performing so well because workers are cheap. Workers are getting cheap relative to inflation. So, firms have an incremental addition an additional incremental incentive to want to bring the more workers on. Um you know against that backdrop of course we have this um the last few months of the year uh from January on you know have been we had one bad month in February but overall all the months have been you know really positive um and that really points to economic reaceleration. We're seeing the weekly economic index and the Dallas Fed, you know, came in above 3% a few times in the past few weeks. That been the strongest number we've had all year. Um so you know really um turning back to the question of consumer confidence, higher inflation, interest rates that are too high, consumers feeling that homes, real estate, residential real estate, single family homes, uh culturally have been a dream, an objective for a lot of American families, individuals even. Um and as that goal has become more out of reach due to expanded valuations and elevated mortgage rates, you know, that's also served to structurally really here weaken consumer confidence um because it's just so out of reach for most consumers when they consider their average paychecks versus what the average mortgage payment is on even in a starter home. Uh so those are some factors why the consumers aren't feeling that great. As far as the businesses, you know, the businesses are they're not feeling that confident either because a lot of the firms in the economy, they're consumerf facing and they're very uh sensitive to shifts in consumer confidence as well as consumer expenditure patterns. So firms that we hear from on the street, publicly traded firms like Home Depot, Lowe's, Shake Shack, McDonald's, Whirlpool, you know, they've been Walmart as well, they've been particularly cautious um on, you know, on consumer spending capacity going forward and have been wary of the potential for households to begin pulling back. That said, the tech area of business of the market of Magnificent 7, of course, that's a totally different story. That's a capex story. That's a story about buying more compute, buying more data centers, buying more semiconductors. Uh it's not that much of an enduser story right now. It's pretty much build as much as you can. really driving down the free cash flows significantly for these firms drove Google to what Google Andrew one of the most profitable firms in the world decided to do a secondary offering because they need more cash to invest in their AI ambitions. I think that's why we're starting to see rising layoff announcements in that space because eventually investors are going to want to see those free cash flow numbers tick back up. Um because if they don't they're now they're becoming Andrew what the benefit of a tech company was to be profit heavy and capital light. Now they're trans if this is a more of a medium-term or longer term event. Now you're talking about a capital heavy kind of business, right? You're talking about an environmentally strained straining kind of business. Uh when you consider the water needs, the electricity needs, energy requirements, etc. So, you know, I think um I think we we're we're in for a special period of analyzing AI and seeing what it can do, what it can't, and see how it really fits in the whole economic backdrop here. — Jose, we're coming into the number in a minute. Uh give us a market rundown. What's how's the market positioned going into this? — Yes. So, the market has been a little weak. The S& P is down um 50 basis points right now. The Q's are down more than 1%. Rates are nearly flat. Uh the Russell 2000 is down as well. So, you know, pretty much a broad selloff this

### [10:00](https://www.youtube.com/watch?v=NfsXOC-Ib0w&t=600s) Segment 3 (10:00 - 15:00)

morning. Let's see if that number can come in and maybe have folks feel a little better. — All right, let's uh let's scour for the latest release. right. Oh gosh. — 172,000. So, a lot stronger than expected. Sorry, we said it at the same time. I guess we pressed refresh simultaneously. Um 172,000 jobs, well above the 85,000 expected. Uh last month revised higher to 179. Market reaction. Interest rates jumping strongly on the news. Uh equities staying where they were, still down pretty sharply. Uh down now losing a little more 1. 2 in the cubes. We'll wait to see. It could be these knee-jerk reactions. Uh but it looks like, you know, yields are up significantly here. So the broadening trade is probably not going to work today. uh the rotation away from those high-powered tech growth names into the more cycllically oriented rate sensitive areas like the Dow Jones Industrial Average, the Russell 2000. Uh it doesn't that trade is has a wide path when rates are coming down. When rates are rising, that trade is very vulnerable, especially with the Dow reaching an all-time high yesterday. So um let's look at some of the other numbers as well. — One in three of the well leisure and hospitality added 70,000 and uh government jobs added uh 70,000. So uh if you work for the government or you work in healthare uh good chance you've uh you've had a good month. um you know broad strength here, Jose. — Yeah. I'm pulling up the sectors now. — The the um the change in March was revised up by 29,000 from 185 to 214. April was revised up by 64,000 to 115. Um and last month 115 up to 179. So that's a combined 93,000 higher than previously reported plus twice the strength today that we expected. So what would you think if you were Kevin Walsh sitting down for his first FOMC meeting this month as the — chairman of the Fed? I think as a dove, you can say, "Listen, let's wait out this one-time energy shock. Let's wait for oil prices to come down. " Um because next year, we're going to have favorable base effects from these elevated oil prices because $100, sorry, $90 today on WTI. Next year could become 80 or 75 against a backdrop of prices that got much higher this year. So, let's say oil prices for this year average 95. If next year's average is 70, then all of a sudden you have a lot of relief on a huge subtraction year-over-year in energy commodities, that's going to filter its way through and start to offer a lot of deep disinflation in some of the other categories. That's a next year story. But that's what this post-pandemic Fed has been all about, Andrew. It's been all about essentially not necessarily waiting for not that you should but the the but maybe more so uh the policy of this Fed has been essentially to uh to start easing early, tightening late and being more of a an accommodative financial monetary policy authority. So I think that that's what's going to end up happening. Although we do have hikes priced into the curve, um I think that ultimately the Fed is just going to stay back and be patient and call this a one-time energy shock. However, uh they could wors could surprise here and it could offer a deja vu of how Powell embarked on his term back in 2018 where President Trump thought that he had an ally in the Fed, but the Fed chair was actually really focused on the economic fundamentals and what the numbers were telling him. And in that case, he was maintaining a tighter policy than what the president wanted. So I wouldn't be surprised the president gets upset here if worse carries a tighter policy than President Trump expects. Of course if he hikes uh

### [15:00](https://www.youtube.com/watch?v=NfsXOC-Ib0w&t=900s) Segment 4 (15:00 - 20:00)

that'll be a huge significant issue um from a Fed independence as well as from a political perspective and I think it'll definitely affect the markets and the dollar. the unemployment rate. The uh the BLS notes that it's been in a tight range since July 2025 of 4. 3 to 4. 5%. What do you make of that? — Uh yeah, very stable. Not we're not seeing layoffs in this economy. We're seeing a lot of stability in the labor conditions. We're having natural turnover. Of course, we've had some immigrant pressures that's been um working the labor supply lower. We've had uh AI adoption by the tech companies. That's also been uh a factor. But all in all, when you uh when you consider every all the the entire backdrop, you know, it's an it's an economy where if you want a job and you are okay waking up early and going to work, you can get one. relatively speaking, irrespective of the skills and qualifications that you have, uh there's jobs available. Folks, I I said this, I have a tendency to sometimes repeat myself um or all the time, but I did say this earlier during the call that job openings are at a 23month high, folks. Job openings that those are the signs you see in front of the stores that say help needed um or we have a job for this this this available, right? That's what job openings is. That means that firms, they want more people in the door. They're seeing an accelerating economy. They need more people to crank out more services or goods, whatever it is that they're producing. Uh and I think it really, you know, it's not a layoff environment at all. It's quite the opposite. manufacturing gains. I think if I'm reading the report correct, it was only 5,000, but it's net positive. — Yeah, manufacturing uh you know, at this point we're um we're happy seeing a positive number next to it. Of course, the buildout there's a risk that once the buildout is complete that we won't actually create many jobs because it'll most of it will be automated. Um, and to be frank, manufacturing has been less labor intensive over the years. So, it's already a sector that's been used to uh managing less personnel. Uh, it's been used to using technology to complete tasks to create goods at the factories. So, you know, it's something that it's a real risk that if folks think that we're going to have a big surge in manufacturing employment, uh, that doesn't manifest. — How [clears throat] what in terms of the prediction markets, which have become extremely popular, Jose, what does, um, what does the strength in today's report tell you? There's a couple of things I'm thinking. one that narrow range in the unemployment rate 4. 3 to 4. 5 kind of feels a little bit like you can uh buy and sell well by yeses and nos around it if it's very stable um but also the strength that we saw today is it worth being um positioning from this in a bullish way going forward — uh in the — for you know for uh the uh employment reports going forward Yeah, I think um buying nos on unemployment, I think that that would work because uh if I had to choose between yes and nos, I would choose nos, which would be bullish because a no means that you're saying that it the unemployment rate won't exceed a certain number, — right? Uh, another thing I like about the nose is that your burden is a little lighter because if the number hits, let's say you buy the no at 4. 4 and the number hits 4. 4, you still win because it didn't exceed it. But with the yeses, you don't have that um that flexibility. If you buy a yes at 4. 3 and the number is 4. 3, then you actually lose. Uh, of course, the pricing adjusts for that possibility. Um, but when you have a number like the unemployment rate that like you said is very rangebound, you know, those kinds of buying those yeses and, you know, getting an even right there that those could hurt um, you know, psychologically at least. H [clears throat] yeah, it seems somehow these very strong revisions uh and it's kind of playing into what you said about this actually being uh you know not a bad economy for

### [20:00](https://www.youtube.com/watch?v=NfsXOC-Ib0w&t=1200s) Segment 5 (20:00 - 25:00)

hiring at all. It seems to be a almost you also mentioned what the uh the nation's bigger companies are doing that they're reporting back on the consumer but it seems to be a case Jose of watch what I do not what I say. — Yeah, definitely. Especially with the consumers. — Yes. — Um yeah, I'm just uh pulling up pulling this up here. Um yeah so for the July number which will reflect this month of June you know the no at 4. 4 is going for 93 cents um you know so that could be a potential um you know gainer if because even if you rise from 4. 3 to 4. 4 you know you'll still get a dollar back on this. So, the market here already pricing a lot of bullishness. Unfortunately, Andrew, for those folks that maybe were looking for an um maybe an undervalued opportunity, you know, not really undervalued here at 93 cents. Uh and then the yeses, we'll look at some yeses here. Uh 4. 2 at 66%. You know, I guess you could if you think the unemployment rate is going to stay flat or go higher. So, either 4. 3 or 4. 4, four, then the yes here at 66 cents. But I don't really love this trade, Andrew, because quite honestly, uh the unemployment rate could drop from 4. 3 to 4. 2 and then the 66 cents becomes zero. So, I don't like this trade. I prefer the 4. 1 actually because falling from 4. 3 to 4. 1, a negative 0. 2% month- over-month move, that's really rare. that just doesn't happen much — especially um uh you know when you have an unemployment rate that's already so subdued you know to go further lower that that'll be tough you know so I think uh here you want to go with the 4. 1 yes I think if I had to choose that's where I would be — all right what's the next piece of data that's coming out Jose — um Yeah. So, you know, it's Friday, so next week we're going to have we're going to be gearing up for some inflation data. But let's take a look at the economic calendar to see what we got coming up in the next few days. Of course, we have CPI and PPI next week. Yes. So, Monday on the US calendar, we're pretty empty. Then on Tuesday, we have National Federation of Independent Business Optimism Index. That's small businesses. Uh then we have the ADP Tuesday report. By the way, that ADP Tuesday report didn't come out today because uh sorry, this week because it doesn't come out weekly on Tuesdays during the week that the monthly report is produced. So that's something that you know it's important to know that. Uh we also have balance of trade on Tuesday. Existing home sales expected to be a little bit of an increase from 4. 02 to 4. 05 million seasonally adjusted annualized units. We got some China inflation on Tuesday night. Uh CPI on June 10th. We'll be back right here same time. Jose Torres, Andrew Wilkinson will be talking about the CPI on Wednesday, June 10th. We have a Bank of Canada interest rate decision. On Thursday, June 11th, we have the producer price index. We have unemployment claims. And then on Friday, we have the preliminary read on University of Michigan consumer sentiment. — All right. Uh if the audience has any questions, you can send them to our uh to this channel through uh X and LinkedIn. Um there's there's nothing in the chat panel just at the minute. Jose, um why don't we play the video? — Absolutely. We're going to go to chief strategist Steve Sassnik. — What exactly are prediction markets? Prediction markets are a way for ordinary investors to express their views on market related events, some of which have very important consequences for one's investing. For example, we all know that elections have ramifications for markets. With midterm elections approaching, it will be very easy for investors to decide who they think has the better chance of taking the lead in the House of Representatives, the Senate, or in any range of specific um congressional or gubernatorial elections. Prediction markets make that very simple. You can speculate on these races or you can effectively use them as a hedge on your investment positions. but

### [25:00](https://www.youtube.com/watch?v=NfsXOC-Ib0w&t=1500s) Segment 6 (25:00 - 30:00)

doing so in a much more targeted way uh than one was able to do before the advent of these products. This to me is the beauty of prediction markets. You can express a view on something that is market related or investment related but that has always been historically difficult to factor into prices in a direct manner. — Walk us through the mechanics. How does one trade? In terms of the mechanics, it's really not that difficult. You buy the yes if you think that the outcome of the contract will occur. You buy the no if you think it won't. And you also exit your contract by buying the opposite contract. So if you're long a yes, you buy a no. no, you buy a yes. Then how does one calculate profit and loss? — Prediction markets are quite straightforward. They trade at a value between zero and one, you know, and these are dollar contracts. So you can speculate a little more in terms of the number of contracts because dollar value is low and in terms of the their percentage return that's based on what you paid and the difference. So the leverage can be quite powerful because if I pay 40 cents for a given contract and it resolves at one, I made 60 cents on my 40 investment. That's 150% return. — And what are some risk considerations? — One thing that we believe mitigates the risk is that these are financial contracts, not bets. These are financial contracts — um by a reputable financial firm with important financial regulation behind them. We believe that these prediction markets are a valuable tool for investors to speculate on or hedge risks that otherwise have not been easy to incorporate in one's portfolio. And that's why we feel very strongly about these products as investment tools and risk management tools rather than just purely speculative instruments. Okay, we're back. Andrew, I wanted to walk through some charts um before we um finished up. — Uh you know, you usually during the commercial, we have a um an opportunity to look through the report a little more rather than um you know, talk uh doing the commentary. So, just going to go through some charts real quick, folks. So it's a just to recap a strong report but the um the market doesn't seem to be I know the losses on the market which were there before this morning seem to be you know we're not coming off the lows so much are we? — Uh no on the S& P we hit 7535. Uh same thing we hit overnight uh at around 2 am or so. Bounced off of that level. I'm expecting the bulls here to try to get a broadening uh and try to defend the 7500 level on the S& P. I think that's an important midpoint between 7,000 and 8,000. Um Q's down over 1. 2% currently. Uh Russell down 70 pips. S& P down, you know, only um 30 bips uh 30 bips right now. Uh and you know, buying coming in. So, we'll see what happens. Interest rates though way higher. Um this is uh what we're seeing here. — Where's the 10ear? — The 10ear's at 453. uh so broke above 450 that you know the fixed income players were trying as you can see in this chart um for quite some time trying to keep the tenure below 450 but today unsuccessful tenure went up and the really uh the stark move here I think is actually going to be in twos Andrew if you can see here uh the 413 on the two-year is the highest um really all year except for the um the lift we caught on May 26 that got us up to 418 or 413 right now on twos. So today we're seeing a bare flattening across the yield curve. Uh shorter maturities here in this case the two-year rising faster than the 10-year. Two years up nine bips, 10 year is up six. Uh in reflection that right now fixed income players are more worried about the Fed tightening rather than a potential uh boom in economic growth that wasn't priced in prior to this report. Um so as well as inflation expectations. So

### [30:00](https://www.youtube.com/watch?v=NfsXOC-Ib0w&t=1800s) Segment 7 (30:00 - 35:00)

growth projections still bouncing off of this report in the short term. Also inflation expectations, but the most significant development from here is that the 2-year is jumping much faster than the longer teners in reflection of monetary policy tightening expectations. In fact, I want to open up the Fed watch tool um from CM from the CME group real quick to point to potential for tightening. So July has a 8% chance of a hike, 25 basis points. Uh September has a uh 27 + 2 29%. October has a uh 40ish% and then December has a uh 41 55 57ish% chance of at least one hike. But notice that one hike folks would get us to 375 400. So there's are the curve is starting to pricing the potential for one two three and even four hikes albeit it's 0. 1% for 450 to 475. Uh that would be 100 basis points above where we are here at 350 to 375. But that's how it starts folks. That's how it starts. you start to get a 1% 2% and then if things you know things don't improve then you can go up to 10 20 you know and then 50. Um turning back to the labor market. So the labor force this is a number of people that are either working or they want to work but they can't find work. So they're participating in the labor market because they're either employed or they're actively looking for employment. dropped to 169. 995 million. That's the lowest going That's the lowest of President Trump's second term. That's the lowest going back to December um 2024. So, uh not a good story there to have less labor supply. Uh labor force participation 61. 8%. That's the lowest going back to October of 2021. Uh so really pandemic kind of participation rates here. Um part of it is the wealth effect, aging demographics, folks feel comfortable retiring with their nest eggs. Also you have the labor supply from the AI in the tech space. You have the immigration restrictions uh really waning way weighing on labor force participation which is not necessarily a terrible thing for those folks that are looking for job opportunities and that want to get in because now there's less people. So, uh, you know, more bargaining power, maybe getting some terms, you know, from a prospective employer that you'd like, maybe negotiating a little more on the wage side. Speaking of wages, up 3. 6% year-over-year, 3. 57. Uh, actually, no, this one is not updated. Uh, let's go back here to see what the wage pressures were. Yeah. So, average hourly earnings 3. 4% year-over-year, folks. 0. 3% month over month. Uh, so 3. 4. Hold that in your head. What are we expecting for inflation on Wednesday? Um, consensus is let me go to our forecast trader here to see what we're expecting on CPI. So wages are growing 3. 4% year-over-year. And what I've been telling folks and what we said earlier on this call is that wages are growing slower than prices. So that means that wages are getting cheaper. So there's an incentive to essentially hire workers. So I we're I'm looking for a 4. 2% number. Let's see where the prediction markets are. Yeah. So, right around 4. 2%. That's where [clears throat] the 50/50 is. Uh, and just a quick announcement, folks, we've also um we have Cali odds on our platform now as well. So, you know, as you can see in the 4. 2 two threshold the prices for forecast X and the cow sheet are slightly different. So you could find arbitrage opportunities in these prediction markets at times, you know, and part of it part of our way of showing you different opportunities across different venues similar to how we do in our traditional brokerage offerings where we have prices available from all different exchanges so that you

### [35:00](https://www.youtube.com/watch?v=NfsXOC-Ib0w&t=2100s) Segment 8 (35:00 - 35:00)

can get the best execution and the best fills. Uh we have the green greenish color here is a cal is a cowi exchange and the white color here is the forecast x exchange. You can see that here uh in the exchange line item. — All right, brilliant. Thank you very much Joseé Torres, senior economist for interactive brokers. We're coming up on the hour. I think that's uh good great coverage of today's uh employment situation from um from the United States. Thank you. Great to be here. I'm reporting from our HQ in Greenwich, Connecticut. Andrew, uh, and we will see you next week for the consumer price index. So long. All right.

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*Источник: https://ekstraktznaniy.ru/video/53059*