A Perfect Storm and An Insane Jobs Report

A dip in the 10-year has markets optimistic about further cuts at the Federal Reserve. The labor market is a lot weaker than we've been told.

Today's jobs report kicks off a pivotal stretch, setting the stage for next week's election and Fed meeting. The report showed just 12,000 new non-farm positions for the month, but the blame for the decline falls on labor strikes and two devastating hurricanes. The bigger news was the two massive downward revisions from previous reports in August and September - enhancing the Fed’s case for further action on interest rates.

Momentum: The timing couldn't be more critical. Today's jobs report lands at the intersection of three major market catalysts - just four days before Tuesday’s too-close-to-call election, days ahead of the Fed's November rate decision, and amid mounting signals that market momentum might finally be shifting. It's a rare confluence with bond volatility surging to yearly highs while equity traders boost defensive positioning ahead of potential volatility. 

Today’s jobs report will justify further focus on the labor market by the Fed. So, look for at least another 25 ba…