15 Minutes Till The Jobs Number. Are You Ready?
Its 8:15 am on a Friday morning and the Non-Farm Payroll is about to be released in 15 minutes. You have already read all the news, checked your emails, checked your Twitter stream and finished that Starbucks Grande Bold coffee. The Street has been getting bullish about the jobs number and whisper numbers have been notched up all week. In fifteen minutes, the “number” will come out and the market is going to move. Only question left is “what will the number be”?
The headline number will hit most news services instantly at 8:30am but you are interested in more than just headlines. You want to know about the U-6 Total unemployed percentage, you want to know which sectors are gaining jobs, you want to know if young people are coming back to the labor force. You decide to pop open a browser and go the the Bureau of Labor Statistics website and have it ready so when 8:30am hits you will be able to parse through the data quickly.
It’s 8:30am. Headline numbers are out. You quickly check the BLS website for some of the specifics that will help guide your trading decisions. But there is a problem. The BLS website is not updating. Something must be wrong with your browser. You close it and open it again, but the BLS website is still down. Meanwhile, S&P futures moved immediately at 8:30am on heavy volume. Seems like everybody is trading the “number” but you. What happened? Here are a few possibilities:
1) According to CNBC, some government websites are being intentionally slowed down by some market participants just as major economic numbers are being released. The article quotes a government official as saying “There’s some bad actors out there who would like to slow down things for others and speed things up for themselves. We’ve blocked certain IP addresses that appear to have malicious intentions to clog up the pipes for others.” Essentially, the BLS website has been quote stuffed.
2) The unemployment numbers may have been leaked. The CNBC article states that “government officials are increasingly worried that their market-moving information could be leaking to traders too early, giving a select, aggressive few unfair access to information that is supposed to be available to everyone at the same time.”
3) The BLS released its data in machine readable news format that was instantly parsed and traded on by high speed market participants. Services like AlphaFlash which is owned by the Deutsche Borse have been touting this ability for quite some time now. AlphaFlash says “data is sent directly from government lock-ups and embargoed releases are available instantly after official release” and their data is “designed for easy direct integration into trading algorithms.”
Good luck, human.