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Jobs number was terrible, but Fed hike still not off the table, strategist says

The Federal Reserve may raise rates despite the latest jobs report coming in well below expectations, Jeffrey Kleintop, chief global investment strategist at Charles Schwab, said Friday.

"We expect at least one move in the second half of this year. I think fed funds futures are supporting a 90 percent likelihood, even after this morning's report, of a rate hike by the end of the year. That's really what the currency is really going to key off of," he told CNBC's "Fast Money: Halftime Report."

Market expectations for a June rate rise plummeted from about 20 percent to just 6 percent, according to the CME Group's FedWatch tool, after the Bureau of Labor Statistics reported employment growth in May was much weaker than expected.

The U.S. economy added just 38,000 jobs in May, while analysts polled by Reuters had forecast a rise of 162,000 jobs.

Financial markets responded sharply to the weak report, particularly currencies. The dollar tumbled 1.6 percent against the euro to $1.133, and nearly 2 percent against the yen to 106.66 yen.

"Japan's not open but you can expect a big down on Monday morning because of what it means for the yen. Remember, yen strength [is] bad news for the Japanese economy," Kleintop said.

Emerging markets soared on the jobs report, with the iShares MSCI Emerging Markets ETF (EEM) advancing 1 percent.

"But take a look at today's moves [and they will] do the opposite for the second half. The Fed is still likely to hike rates. ... This is one report, and I don't think it takes the Fed off the table," Kleintop said. "You can stay in financials and stay underweight in emerging markets."