NFP report disappoints, markets remain near all time highs

A very anticipated Non-Farm Payroll employment report disappointed, with the economy adding 266,00 jobs compared to the expected 990,000 and after Wednesday's ADP report also came in below expectations, showing an increase of 742,000 jobs compared to the expected 872,000. Investors were hoping to see a continuation of the positive trend indicating a consistent recovery of the economy from the covid-19 pandemic. However, indices did not show a large reaction to this report and pulled back slightly, with the S&P 500 dropping 0,25% but returning close to it’s recently reached all time high. On the other hand, gold jumped from $1817 to $1841 gaining over 1,3% while EURUSD also gained and managed to break through the key 1.21 level. This comes days after treasury secretary Yellen’s comments about the potential need to adjust rates which were later countered by the FED, and could lead to a response from the central bank in the near future. It is still unclear if that response will be through reassurance, as it has been doing so far, or if this time the FED will choose to take some sort of action and accept the resulting consequences.

British airways owner ramps up pressure after disappointing earnings

While the Airline industry has been one of the hardest hit by the pandemic with travel lockdowns and general fear which has led to a significant drop in demand for air travel. One of the companies most affected has been British Airways whose share price has suffered a drop of over 70% at the start of the pandemic and has been slowly trying to recover. In its latest report, IAG reported earnings of €968m (£840m) for the first quarter, down from €4.6bn for the same period of last year, with an operating loss of €1,07bn. While Boris Johnson has announced some easing of travel restrictions from the 17th of May, it could take a very long time for these companies to recover and return to pre-pandemic levels. It will be interesting to see how they will choose to strategize in a situation where there could be an enforced cap on capacity, or even the possibility of a portion of the population being travel restricted for lacking the appropriate vaccine documentation.