Consensus for private payrolls today is 90,000 workers, according to survey of economists by Bloomberg News. But the headline is likely to show a loss of ~65,000.
Given this ongoing noise of the federal census hiring and firing, you should ignore the headline number, focus on the private payroll data. Any number near +100k, though historically soft, would be viewed as a positive.
Whether we see an up or down-side surprise, the results could cause an interesting cascade of reactions:
If the payroll report comes in weak:
-It sets up the argument for more stimulus, and other government involvement in the economy;
-It may drive yields down even further on government treasuries;
-It has political ramifications for November mid-term elections;
-Argues for QE2 and QE3;
-Allows the Fed to consider maintaining their ongoing accommodative policy
A strong payroll report:
-Sets up the argument that stimulus is unnecessary;
-Could cause yields to rise;
-Has political ramifications for November mid-term elections;
-Allows the Fed to consider moving to a less accommodative policy
Your guess as to how much of this is built into stock prices is as good as mine . . .
Employment situation is out at 8:30am