×

Did ADP Set Expectations Too High for Jobs Number?

Again, the Street is focused on high unemployment with the jobs number due Friday morning. What should you expect?

According to consensus estimates, employers are expected to have created 90,000 jobs last month after expanding payrolls by only 54,000 in May, which was the smallest gain in eight months. (The May figure represented a sharp slowdown in job creation after a 232,000 jump in April.)

Also, estimates suggest the unemployment rate held steady at 9.1 percent in June.

Here’s a look at Street expectations:
Nonfarm Payrolls Private Payrolls
Median +90,000 +110,000
Minimum +40,000 +55,000
Maximum +168,000 +180,000
Prior +54,000 +83,000

However, those estimates were compiled before data released by ADP on Thursday showed U.S. private hiring increased by more than double expectations – and as a result a growing number of investors are hoping for an upside surprise.

Is ADP ahead of the curve or did the new data set expectations too high?

OptionMonster Jon Najarian seems concerned. He tells us, that according to Bespoke, ADP is only about 52% accurate. The number could be squishy. And the University of Michigan sentiment survey really dropped this month. Those are two negative signs and could mean the market is setting up for disappointment.

Karen Finerman thinks a sell-off on Friday is the most likely outcome. She feels the market has already priced in a really strong jobs number. “(To maintain the rally) I think the number would have to blow it out of the park,” she says.

Joe Terranova is completely on the other side. He thinks money managers are under invested in equities and even if the jobs number is weak, he thinks that ‘chase for performance’ provides support underneath the market. And if the number is higher than expected he thinks the pain is to the upside.




______________________________________________________
Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment, but not have it published on our Web site, send those e-mails to fastmoney@cnbc.com.

Trader disclosure: On July 7, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Terranova owns (XOM); Terranova owns (HAS); Terranova owns (DIS); Terranova owns (WFM); Terranova owns (LULU); Terranova owns (MSFT); Terranova owns (TM); Terranova owns (JWN); Terranova owns (MCD); Terranova owns (PEP); Terranova owns (MA); Terranova owns (BX); Terranova owns (CAT); Terranova owns (VRTS); Terranova owns (AAPL); Terranova owns (F); Terranova owns (CVI); Terranova owns (IBM); Terranova owns (FCX); Jon Najarian owns (AAPL) calls; Jon Najarian owns (AMKR) calls; Jon Najarian owns (BIDU) calls; Jon Najarian owns (DANG) calls; Jon Najarian owns (SINA) calls; Jon Najarian owns (UA) calls; Jon Najarian owns (WNR) calls; Finerman owns (AAPL); Finerman owns (BP); Finerman owns (CVS); Finerman owns (IBM); Finerman owns (JPM); Finerman owns (MSFT); Finerman is short (SPY), (MDY), (WM); Finerman owns S&P puts; Finerman owns S&P calls; Finerman owns Russell 2000 Puts

For Joe Terranova
Terranova is Chief Market Strategist of Virtus Investment Partners, LTD
Virtus Investment Partners Owns More Than 1% Of (ABAX)
Virtus Investment Partners Owns More Than 1% Of (AMKR)
Virtus Investment Partners Owns More Than 1% Of (CCG)
Virtus Investment Partners Owns More Than 1% Of (CASS)
Virtus Investment Partners Owns More Than 1% Of (CSVI)
Virtus Investment Partners Owns More Than 1% Of (EXR)
Virtus Investment Partners Owns More Than 1% Of (FCFS)
Virtus Investment Partners Owns More Than 1% Of (IGE)
Virtus Investment Partners Owns More Than 1% Of (KRC)
Virtus Investment Partners Owns More Than 1% Of (LDR)
Virtus Investment Partners Owns More Than 1% Of (NRCI)
Virtus Investment Partners Owns More Than 1% Of (DBV)
Virtus Investment Partners Owns More Than 1% Of (XLB)
Virtus Investment Partners Owns More Than 1% Of (XLV)
Virtus Investment Partners Owns More Than 1% Of (XLP)
Virtus Investment Partners Owns More Than 1% Of (XLY)
Virtus Investment Partners Owns More Than 1% Of (XLE)
Virtus Investment Partners Owns More Than 1% Of (XLF)
Virtus Investment Partners Owns More Than 1% Of (XLI)
Virtus Investment Partners Owns More Than 1% Of (XLK)
Virtus Investment Partners Owns More Than 1% Of (XLU)
Virtus Investment Partners Owns More Than 1% Of (SUBK)
Virtus Investment Partners Owns More Than 1% Of (WDFC)
Virtus Investment Partners Owns More Than 1% Of (YDNT)
Virtus Investment Partners Owns More Than 1% Of DOMINO'S PIZZA UK & URL PLC
Virtus Investment Partners Owns More Than 1% Of (DRYS)

For Mike Khouw
Cantor Fitzgerald is a market maker in (AA)
Cantor Fitzgerald is a market maker in (AAPL)
Cantor Fitzgerald is a market maker in (AMZN)
Cantor Fitzgerald is a market maker in (C)
Cantor Fitzgerald is a market maker in (CSCO)
Cantor Fitzgerald is a market maker in (CVS)
Cantor Fitzgerald is a market maker in (DAL)
Cantor Fitzgerald is a market maker in (EBAY)
Cantor Fitzgerald is a market maker in (GS)
Cantor Fitzgerald is a market maker in (JPM)
Cantor Fitzgerald is a market maker in (GOOG)
Cantor Fitzgerald is a market maker in (XLF)
Cantor Fitzgerald is a market maker in (XLE)
Cantor Fitzgerald is a market maker in (NFLX)
Cantor Fitzgerald is a market maker in (NYX)
Cantor Fitzgerald is a market maker in (MSFT)
Cantor Fitzgerald is a market maker in (YHOO)

For Karen Finerman
Finerman's firm owns (AAPL)
Finerman's firm owns (BP)
Finerman's Firm owns(CVS)
Finerman's firm owns (JPM) and (JPM) leaps
Finerman's firm owns (MSFT)
Finerman's firm owns (TGT)
Finerman's Firm owns (USO)

CNBC.com with wires.