| Good morning. Nvidia stays in the limelight, a plan to raise capital gains taxes and this week's all important jobs report. Here's what's moving markets. — Sam Unsted Want to receive this newsletter in Spanish? Sign up to get the Five Things: Spanish Edition newsletter. Nvidia said it has not been subpoenaed by the Department of Justice as part of an antitrust probe, as shares in the chipmaker continue to settle following Tuesday's selloff. That drop has traders scouring charts for clues on when the pain might end, with $100-a-share becoming the key number to watch. TSMC, the Taiwanese chipmaking giant, dismissed worries fueled by Nvidia's wipeout regarding the strength of demand for AI. That narrative will get another test after the close when Broadcom reports. Stock futures are fluctuating as markets await the key US jobs data on Friday, with ADP numbers and jobless claims coming as a prelude today, plus the ISM services reading later. The Federal Reserve's Beige Book showed flat or declining economic activity across most regions in recent weeks. And traders are trying to position for the jobs data, plus Fed officials due to speak on Friday, by snapping up specialized wagers on the Japanese yen surging in the next year. Should the much-anticipated payrolls data on Friday be weak, the stock market could be headed for a correction, Goldman Sachs said. The bank's Scott Rubner said the last two weeks of September are historically the worst for the S&P 500 and the boost from buybacks will fade. John Authers said that the jobs report this week has become an "unhealthily big event" and that risks are now skewed toward the negative positioning in the market being overdone. Joe Weisenthal gets into the importance of this jobs report below. US Vice-President Kamala Harris called for a 28% capital gains tax on people that earn $1 million or more as the presidential candidate continues to seek to detail her economic agenda and draw a contrast to Republican rival Donald Trump. Bank of America said the US ballot is starting to emerge as a top risk to the global economic outlook, albeit a tough one to assess. JPMorgan Chase has scrapped its buy recommendation for Chinese stocks, citing volatility around the US election among its reasons. The Bank of Japan could need to hike rates by more than currently envisaged should the data justify it, according to board member Hajime Takata. Real wages in the country unexpectedly rose for a second consecutive month, keeping the bank on track for another rate hike. President Joe Biden, meanwhile, is preparing to block a proposed $14.1 billion takeover of US Steel by Japan's Nippon Steel. Japan's Digital Transformation Minister Kono Taro said the US government intervening in the deal was inappropriate. This is what's caught our eye over the past 24 hours. Tomorrow is Jobs Day and by now you know that a lot is, apparently, riding on this number. It seems to be basically a coinflip as to whether we get a 25 or 50 basis-point cut at the upcoming Fed meeting later this month. This non-farm payrolls report could be the decider. One of the debates going on right now is whether "it's different this time" with respect to the Sahm Rule. Last month, when the unemployment rate jumped to 4.3%, the rule was officially triggered. And every other time this happened post-World War II it meant that a recession was already under way. One reason to think that might not be the case this time -- as Claudia Sahm has herself discussed -- is that the rise in the unemployment rate is due to a low pace of hiring, as opposed to a rise in the pace of firing. In other words, it's possible that the economy is still growing, but that we're seeing a big influx in the number of people looking for jobs (immigration, reversal of pandemic era trends etc.) and that's pushing the number up. But regardless of whether that's the case, we know a couple of things. 1) Several labor market indicators have clearly softened. 2) If we're going to absorb the increase in the size of the total labor force, then we need to see a faster pace of job creation. So to some extent, the big question is -- recession or not -- whether we'll see a hiring rise. And on this note, yesterday we got the JOLTS report for July, so that's already stale news. And it did show a slight uptick in the hiring rate. And it also showed an uptick in the Quits Rate. But the total number of job openings came in way below expectations at 7.67 million vs. expectations of 8.1 million. Also, the previous month's opening figure was revised downwards. 2-year yields dropped right at 10 a.m. when the report came out, as traders priced in more Fed easing on the back of the data.
Again, it's JOLTS and it's stale. But right now, we're in a "low hiring, low firing mode" as Richmond Fed President Tom Barkin put it in a recent interview. He added that this is unlikely to persist very long. One of the two is likely to pick up. And with the number of job openings falling as much as it as, that obviously increases the concern that the low hiring component is not likely to reverse soon. Follow Bloomberg's Joe Weisenthal on X @TheStalwart | 
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