-
INSTANT VIEW 1-US loses 693,000 private-sector jobs in Dec-ADP
NEW YORK, Jan 7 (Reuters) - U.S. private employers shed 693,000 jobs in December, up sharply from the revised 476,000 jobs lost in November and far more than economists estimated, a report by a private employment service said on Wednesday. Story: KEY POINTS: * The median of estimates from 20 economists surveyed by Reuters for the ADP Employer Services report was for 473,000 private-sector jobs lost in December. * The report for December was the first month the data was issued using a new methodology, which ADP said was designed to more closely predict the outcome of the government's non-farm payrolls report. * The report is jointly developed with Macroeconomic Advisers LLC. COMMENTS: DAVE LUTZ, MANAGING DIRECTOR, STIFEL NICOLAUS, BALTIMORE: 'It is absolutely terrible. Both the Challenger number and the ADP number, they're very, very volatile. When we're dealing with volatile economic numbers like that what we look at the revision, and obviously the revision is much worse, and the trend continues to be negative, negative, negative. 'I can't imagine this is going to bode very well for any kind of forecasting going into the nonfarm payroll and unemployment rate numbers that we're going to see on Friday. I would anticipate some kind of weakness... There's a chance that the market shrugs it off today, but we could definitely see some kind of weakness going into that nonfarm payroll number on Friday.' KURT KARL, CHIEF U.S. ECONOMIST, SWISS RE, NEW YORK: 'We've had some bad months. This number seems a little large to me. We expect half of that. 'The economy continues to deteriorate at a rapid rate and there is no end in sight. We don't see any bottom with any of the indicators.' ROBERT MACINTOSH, CHIEF ECONOMIST, EATON VANCE CORP, BOSTON: 'The only one number that really counts is the number on Friday. On the face of it, it is more negative, more dire than what had been on paper. It does further tell you that the economy is weak, that we are in a deep, deep recession.' KEN LANDON, SENIOR CURRENCY STRATEGIST, JP MORGAN CHASE: 'The ADP number confirms people's knowledge of a very weak month and the dollar and equities have come off sharply as a result. Although the ADP is known to be widely unreliable, the report plays into the market's worst fears.' LOU BRIEN, MARKET STRATEGIST, DRW TRADING GROUP, CHICAGO: 'Treasuries are reacting mildly to the ADP report. Stocks are reacting sharply, but bonds are only gaining a little bit on this horrendous report, which could be the worst result in about 60 years.' STEVEN BUTLER, DIRECTOR, FX TRADING, SCOTIA CAPITAL, TORONTO: 'It's obviously a terrible number, though everyone was expecting a terrible number. And if you look at the revision for the last month, it tends to be an unreliable number, too. But the initial shock is a big one, and the market was leaning toward selling dollars to begin with today. While you have to take it with a grain of salt, it's still a pretty ugly number and should keep the dollar under pressure for the rest of the session.' PETER KENNY, MANAGING DIRECTOR, KNIGHT EQUITY MARKETS, JERSEY CITY, NEW JERSEY: 'I think the consensus was that the number was going to reflect half a million jobs lost in December. This was substantially higher, and when coupled with the weakness in the manufacturing sector, it underscores the weakness and fragility of our current climate. I'll tell you this, though, once those numbers came out, the Dow was kicked down substantially. Couple that with the news of Alcoa cutting jobs from after the close last night and I don't care who you are, it's got to make you pause because its pretty bleak. There's always fresh optimism at the start of the year, but this could dampen that very very quickly.' MARKET REACTION: STOCKS: U.S. equity index futures extend losses after bigger-than-expected drop in Dec ADP report. BONDS: U.S. Treasuries pare losses. DOLLAR: U.S. dollar extends losses against euro. Keywords: USA MARKETS/ADP (Reporting by New York Treasuries Desk; +1-646 223-6300) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.