As the Non-Farm Payrolls (NFP) report approaches, market participants are eagerly awaiting insights into the US labor market’s health. To help navigate the potential market moves, JPM US Market Intelligence has created a scenario matrix based on historical data. In this blog post, we will delve into the matrix and explore the possible outcomes for the S&P 500 index (SPX) based on the different NFP scenarios.

**Scenario 1: Above 105k**
If the NFP report shows a gain of over 105,000 jobs, the SPX is likely to experience a decline of around 0.5% to 1%. This is because such a strong job growth figure could signal a strengthening economy, which could lead investors to become more cautious and reduce their exposure to equities.

**Scenario 2: Between 75k – 100k**
A gain between 75,000 and 100,000 jobs would result in a modest gain for the SPX, ranging from 0.25% to 1%. This is because while the job growth figure is not overly strong, it is still indicative of a healthy economy. As such, investors may remain optimistic but with slightly reduced enthusiasm compared to the previous scenario.

**Scenario 3: Between 35k – 75k**
A gain between 35,000 and 75,000 jobs would lead to a more significant gain for the SPX, ranging from 0.25% to 0.75%. This is because while the job growth figure is not as strong as the previous scenarios, it is still indicative of an economy that is growing at a steady pace. As such, investors may become more optimistic and increase their exposure to equities.

**Scenario 4: Between 0k – 35k**
If the NFP report shows a gain between 0 and 35,000 jobs, the SPX is likely to experience a decline of around 0.25% to 0.5%. This is because such a weak job growth figure could signal a slowdown in economic growth, which could lead investors to become more cautious and reduce their exposure to equities.

**Scenario 5: Below 0k**
Finally, if the NFP report shows a loss of jobs or a very weak gain, the SPX is likely to experience a decline of around 0.5% to 1.25%. This is because such a poor job growth figure could signal a significant slowdown in economic growth, which could lead investors to become highly cautious and reduce their exposure to equities.