Non-farm payrolls disappointed the market again. The chart below shows the expectation (yellow bars) and the actual number — economists have been over-excited about this number for the past three months.

The market believes that the employment picture is improving, but that belief is vulnerable to continuing disappointment. That said, markets react to turning points and the trend in payrolls has turned up. Also, the trend in initial jobless claims has turned down, although the number has been volatile recently:
The unemployment rate fell by 0.4%, mostly owing to people leaving the labour force. That is not good news and a reminder that the employment recovery remains very weak.
S&P 500 futures spiked around on high volume after the release, and then settled back pretty much where they started (chart below shows 1-minute bars):
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