6 Dec 2013
For the most part, the US market drifted lower each day, that was until Friday, at which point it took a double shot, came to life and rallied to end the week effectively unchanged. A stronger than expected jobs number, 203k versus market expectations of 185k, was the hit the market needed and investors appear to becoming increasingly more comfortable with the tapering scenario. Unemployment now sits at a five year low of 7% and a separate report highlighted that consumer spending rose more than forecast in October. There appears sufficient information to support a December commencement for tapering but the jury clearly remains firmly out on this. Despite the better than expected employment number, Friday’s reaction was one of a no tapering scenario rather than its early introduction.