Germany's Economic Growth Forecast Revised Downward, ADP Employment Shows Significant Slowdown

Asian stocks tracked Wall Street's rise to a record high and Treasury yields eased to four-month lows on Friday as traders cemented bets for the Federal Reserve to cut rates this month, even with crucial U.S. jobs data looming later in the day.The U.S. dollar eased slightly, giving up small gains from Thursday, when it was buoyed by soft labour market figures.

Gold held steady after Thursday's retreat from an all-time high.

Crude oil drifted lower for a third straight day as investors awaited an OPEC+ meeting this weekend that will consider further output hikes.Markets are all but certain of a quarter-point cut at the conclusion of the Fed's two-day rate-setting meeting on September 17, and price a cumulative 60 basis points of reductions this year.On Thursday, data showed that the number of Americans filing new applications for unemployment benefits increased more than expected last week, while hiring by private employers slowed in August, further evidence that labor market conditions were softening.Economists expect Friday's non-farm payrolls report to show the economy added 75,000 jobs in August, not much above the 73,000 figure for July, that first set a fire under expectations for a near-term Fed rate reduction.

Fed Chair Jerome Powell later reinforced that speculation with an unexpectedly dovish speech at last month's closely watched Fed symposium in Jackson Hole, Wyoming."Unless it's an absolutely stellar payrolls print, it's hard to see too much that's going to change the market away from locking in a September cut," said Ken Crompton, head of rates strategy at National Australia Bank."Beyond that, the terminal rate and how you get there, that's arguably still up for grabs."Expectations of an easier monetary environment have supported global equities, and the S&P 500 rose 0.8% on Thursday to finish at a record high. The Nasdaq climbed 1% to just shy of its own all-time closing high from August 13.

S&P 500 futures pointed 0.1% higher on Friday, and Nasdaq futures advanced 0.3%.

Japan's Nikkei rose 0.8% and Taiwan's stock benchmark climbed 0.8%. Both those markets are close to recent record highs.

Hong Kong's Hang Seng and mainland Chinese blue chips each added about 0.4%.

Australia stocks gained 0.3%.

"The non-farm payrolls data tonight is something of a sink or swim moment for the markets," said Kyle Rodda, senior financial market analyst at Capital.com."The critical question is ... whether the Fed is in the right position to lower rates and buffer the economy, or if it's behind the curve," he said. "Should the data point (to) an economy accelerating off a cliff, that could spark risk aversion and volatility."

Source: Yahoo Finance

The Department of Homeland Security (DHS) announced on Sept. 3 that it was revoking the 2021 designation of temporary protected status for Venezuelan nationals in the United States.

That status, which was previously set to expire on Sept. 10, will now be terminated 60 days after that date when the department publishes its notice to the Federal Register. The department indicated that it no longer believes Venezuelan nationals met the statutory requirements for temporary protected status.

“Given Venezuela’s substantial role in driving irregular migration and the clear magnet effect created by Temporary Protected Status, maintaining or expanding TPS for Venezuelan nationals directly undermines the Trump Administration’s efforts to secure our southern border and manage migration effectively,” U.S. Citizenship and Immigration Services spokesman Matthew Tragesser said in a statement.

“Weighing public safety, national security, migration factors, immigration policy, economic considerations, and foreign policy, it’s clear that allowing Venezuelan nationals to remain temporarily in the United States is not in America’s best interest.”Temporary protected status (TPS) is a program that gives people from certain countries the ability to stay in the United States legally for a period of time. The head of the Department of Homeland Security creates the program if temporary and extraordinary conditions prevent the migrants from returning to their home countries safely.

President Joe Biden, President Donald Trump’s predecessor, established two designations of temporary protected status for Venezuelan nationals residing in the United States. The first, which was unveiled in 2021, was affected by Wednesday’s revocation. The second, which Biden announced in 2023 and was set to expire in April before it was extended for 18 months, was terminated by the Trump administration earlier this year.At the time, Homeland Security Secretary Kristi Noem determined that “it is contrary to the national interest to permit the covered Venezuelan nationals to remain temporarily in the United States.”

Biden’s Homeland Security Secretary Alejandro Mayorkas had granted temporary protected status to roughly 348,202 Venezuelan nationals, deeming that there were “extraordinary and temporary conditions in Venezuela that prevent individuals from safely returning.”In May, the Supreme Court temporarily blocked a lower court’s order to prevent the Trump administration from removing the temporary legal protections for Venezuelans so that the U.S. Court of Appeals for the Ninth Circuit could weigh in on the issue.

Then, the federal appeals court last week upheld the original order that stopped the administration from moving forward with the policy that would make it easier to deport Venezuelan nationals.U.S. District Judge Edward Chen, who issued the original order, said at the time that ending the program “for reasons of national security” was not backed by evidence.“Venezuelan TPS holders have lower rates of criminality than the general population,” he said.

“Generalization of criminality to the Venezuelan TPS population as a whole is baseless and smacks of racism predicated on generalized false stereotypes.”On Wednesday, the Homeland Security Department said Noem had moved to end the 2021 designation of temporary protected status for Venezuelans because keeping the program “is contrary to the national interest.”“Venezuelan nationals leaving the United States are encouraged to use the U.S. Customs and Border Protection CBP Home app to report their departure from the United States and take advantage of a safe, secure way to self-deport that includes a complimentary plane ticket, a $1,000 exit bonus, and potential future opportunities for legal immigration,” the agency wrote in a news release.

Source: Zero Hedge

Key Takeaways:

Fed's John Williams Predicts Tariff-Driven Inflation Rise

Federal Reserve Bank of New York President John Williams stated tariffs could increase U.S. inflation by 1.0% to 1.5% throughout 2025.The inflation forecast impacts financial markets, potentially influencing asset valuations and investment strategies, particularly regarding risk management and monetary policy outlook in upcoming quarters.John Williams, President of the Federal Reserve Bank of New York, revealed that tariffs could significantly impact U.S. inflation. He stated that tariffs are expected to add between 1.0% and 1.5% to inflation by 2025."All in all, I expect tariffs will boost overall prices by a total of between 1 and 1-1/2 percent, with these effects continuing through the coming quarters."

Williams emphasized in his speeches that the tariff effects will become more pronounced in the coming quarters. The Federal Reserve's recognition of these effects highlights the potential challenges in managing U.S. monetary policy.The potential increase in inflation is expected to affect various sectors. This includes broad U.S. markets, where changes might be observed in U.S. Treasury yields and equities. However, specific impacts on crypto markets are not directly acknowledged.The tariff-induced inflation rise might influence capital allocation and risk assessment by institutional investors. With U.S. monetary policy being shaped by these developments, it could lead to changes in financial strategies and market behaviors.

The discourse on tariffs adds an element of uncertainty to economic planning. This could, in turn, influence investor sentiment and regulatory decisions, especially in sectors sensitive to inflation trends.As inflation pressures persist, historical patterns indicate increased volatility and possible shifts in asset valuation. Resources may reallocate to “harder” assets such as Bitcoin, seen as a hedge in inflationary contexts.

Source: CryptoSlate

Hiring at US companies was less than forecast in August, consistent with other evidence that points to weaker demand for workers.

Private-sector payrolls increased by 54,000, roughly half the pace of the prior month, according to ADP Research data released Thursday. The median estimate in a Bloomberg survey of economists called for a 68,000 gain.

The report lines up with recent data that indicate the labor market is gradually cooling, marked by fewer job openings and softer wage gains. Job growth has slowed significantly in recent months, and it’s taking longer for unemployed people to find a new job.

“The year started with strong job growth, but that momentum has been whipsawed by uncertainty,” Nela Richardson, chief economist at ADP, said in a statement.

The government’s August employment report, due Friday, will be closely watched by the Federal Reserve and investors after the prior release showed employment was substantially weaker in recent months than previously thought. Economists are forecasting payrolls rose by 75,000 in the month and slightly higher unemployment.

Fed officials are expected to lower interest rates by a quarter percentage point at their policy meeting later this month amid concerns about further weakening in the labor market. Traders maintained those bets after the ADP data, while stock futures and Treasuries held gains.

Source: Bloomberg Europe

A "now hiring" sign is displayed on a local business after, U.S. employment growth slowed more than expected in July, in Encinitas, California, U.S. August 1, 2025.Markets have been rising on hopes that weak jobs data will lead to rate cuts. But they could be staring at an oncoming freight train if the U.S. nonfarm payrolls data due Friday sends recessionary signals.The ADP private payrolls report on Thursday showed an increase of 54,000 jobs in August, lower than the 75,000 expected by economists polled by Dow Jones. The figure is also less than the revised 106,000 jobs added in July.

Jobless claims for the week ended Aug. 30 also increased to 237,000. That number came in above estimates and marked an 8,000 gain from the prior week, providing more evidence of labor market slowdown.Currently, the market has shrugged off that data. All three major U.S. indexes ended in positive territory Thursday, with the S&P500 notching a record high.But that's the thing about freight trains. You hear them them faintly in the distance, and all of a sudden, you're scrambling to jump out of the way as it barrels down on you.Friday's nonfarm payrolls report is expected to show 75,000 additions last month, according to a Dow Jones poll.

Investors will then know if the train is simply pulling into a station, or their portfolios are about to get run over — and optimism in itself isn't always a great armor.

What you need to know today

S&P notches new record high. The S&P 500 closed at its 21st record high of the year after an afternoon boost pushed stocks solidly into the green as traders shook off weak private employment data earlier in the day. The Nasdaq Composite and Dow Jones Industrial Average also recorded gains. Over in Europe, the pan-European Stoxx 600 closed 0.6% higher, led by media and telecoms stocks.Broadcom shares pop. The company's stock rose in extended trading Thursday after announcing it had secured $10 billion in orders from a new client for custom chips. Broadcom also reported fiscal third-quarter earnings that beat expectations and provided robust guidance for the current quarter.

Lululemon plunges. Shares plunged in extended trading after the company gave a much-worse-than-expected full-year outlook. The company topped second-quarter earnings estimates but slightly missed revenue expectations. It expects tariffs to hit its full-year profits by $240 million.Trump vs FTC. U.S. President Donald Trump asked the Supreme Court to allow him to fire Federal Trade Commission commissioner Rebecca Slaughter, who lower courts ordered reinstated after he terminated her. Trump in March removed Slaughter and another Democratic commissioner, Alvaro Bedoya, as part of a sprawling effort to exert his influence over federal agencies.

Global banks and gold miners preferred. There's been a rush into international equities in 2025, and demand appears to be increasing. Portfolio managers at Lazard Asset Management tell CNBC where they are seeing opportunities.

And finally...

How Gen Z workers are reshaping corporate norms as they return to office

As Gen Z workers return to the office, they're reshaping corporate norms by embracing AI, normalizing mental health chats, and being more authentic at work.This has given rise to a series of new workplace trends from the viral "Gen Z stare," to the "office siren" aesthetic and even TikTok slang like "ick" becoming normalized in professional lingo.

Source: CNBC

Key points:

Just one day after Florida Governor Ron DeSantis announced his plan to stop requiring vaccines for grade-school children and others, the needed approval by the state's Republican-controlled legislature is already showing signs of a heated battle to come.DeSantis' surgeon general, Joseph Ladapo, who joined the governor in announcing on Wednesday the plan to scrap all vaccine mandates, said quite simply of what will be before lawmakers: "People are going to have to choose a side."

On the opposite side of the aisle the state's Senate Democratic leader, Lori Berman, said she will fight to "protect our kids from these reckless attempts to harm them.”DeSantis' action comes amid a controversial national debate, often led by U.S. Health Secretary Robert F. Kennedy Jr., over vaccines. Although multiple states in recent years have proposed banning or weakening vaccine mandates, only Idaho successfully introduced a ban on school vaccine requirements. If Florida, the third largest U.S. state with a population of roughly 23 million, is successful, it could open a new chapter in the vaccine wars.

While about a half dozen existing vaccine mandates in Florida can be ended immediately because they are enforced under administrative rules, another half dozen vaccines - including those for measles, mumps and polio - must be ended by the legislature because they are mandated in law."They're going to have to make decisions," Ladapo said of lawmakers when he announced the push to end vaccine mandates.

The next scheduled legislative session begins in January.

Republican leaders in the Florida House and Senate did not respond to requests for comment. None had issued any statements of support for the plan to end vaccine mandates by Thursday evening.

But Democrats sharply criticized the move.

“Republicans have gone from entertaining anti-science conspiracy theories to fully endorsing an anti-science health policy," said Berman, the Senate Democratic leader, on Thursday. "As a member of the Senate Health Policy Committee, I’ll be doing everything in my power to protect our kids from these reckless attempts to harm them.”"This is a public health disaster in the making for the Sunshine State," Democratic Representative Anna Eskamani said in a statement.In addition to protecting the individuals who get vaccinated, widespread vaccination in a community safeguards infants who are too young for the shots as well as people whose health conditions prevent them from being vaccinated.

The Florida Medical Association, which backed DeSantis when he first ran for governor in 2018, strongly rejected an end to vaccines mandates. "The Florida Medical Association unequivocally supports the vaccination and immunization of school-aged children against diseases that decades ago proved life-threatening to our kids," it said in a statement Thursday.The passage earlier this year in Florida of a more modest effort to address vaccine mandates might augur of what lies ahead in winning approval for DeSantis' plan. The measure, which was championed by DeSantis, passed in both houses, but only after language was removed that would have applied a prohibition of services based on vaccine status to doctors and medical facilities.

Even strong supporters of ending vaccine mandates see challenges ahead.

Michael Kane, director of advocacy for Children’s Health Defense, an anti-vaccine group founded by Kennedy, applauded the Florida move, but noted the difficulty of winning legislative approval. "They have to actually go through the whole process of repealing those laws, which isn't always an easy trick.”Kennedy, who was grilled in the U.S. Senate over vaccines on Thursday, has promoted the view that vaccines contribute to rising rates of autism, contrary to scientific evidence. Since taking office this year, he has fired expert vaccine advisers to the CDC, replacing them with people who more closely share his views.

Del Bigtree, founder of the anti-vaccine group Informed Consent Action Network and former communications director for Kennedy's presidential campaign, said he was ecstatic about the Florida action, and forecast that several other conservative state legislatures would soon follow suit. "This is the pivotal issue in politics today,” he said.Four Democratic-led states, California, Oregon, Washington and Hawaii, have banded together in response to the move against vaccines, saying said this week they had created the West Coast Health Alliance to provide vaccine recommendations, even if they diverge from federal government recommendations.

Source: TradingView