US Sept payrolls jump takes Nov 50 bp cut off the table

(Reuters) -U.S. job growth accelerated in September and the unemploymentrate slipped to 4.1% from August's 4.2%, further reducing theneed for the Federal Reserve to maintain large interest ratecuts at its remaining two meetings this year. < > by 254,000 jobslast month after rising by an upwardly revised 159,000 inAugust, the Labor Department said on Friday. Economists polledby Reuters had forecast payrolls rising by 140,000 positionsafter advancing by a previously reported 142,000 in August. The initial payrolls count for August has typically beenrevised higher over the past decade. MARKET REACTION:STOCKS: S&P 500 E-minis extended 0.73% higherBONDS: The yield on benchmark U.S. 10-year notesrose to 3.934%, the two-year note yield rose to3.8469%FOREX: The dollar index turned 0.6% higher

FED FUNDS FUTURES: Odds of a 25-bp cut at the Fed's November meeting rose to 93% from around 71% before the data, according to LSEG calculations.COMMENTS: WASIF LATIF, PRESIDENT AND CHIEF INVESTMENT OFFICER, SARMAYA PARTNERS, PRINCETON, NEW JERSEY

“This is definitely much stronger than what was expected. I think it’s catching quite a few people by surprise. It means that the 50-basis point rate cut that we already got – which was good for sort of psychology and in the overall sentiment; and the next rate cut might not need to be as big. The initial reactions are that yields are jumping, and the market is taking off some of the degree or the number of rate cuts off the table or pushing them further out. I think on the equity side, equity markets are still buoyant. It looks like they like this. So, it could be a case of good news is good news.”

PETER CARDILLO, CHIEF MARKET ECONOMIST, SPARTAN CAPITAL SECURITIES, NEW YORK

"They were much stronger than expected and obviously it negates the fear of perhaps the economy moving to negative growth anytime soon... it basically tells us economic activity in the fourth quarter is likely to remain at a solid pace. The fact that you only had 13 cents rise in hourly wages is good news for the Fed. It's a blowout report, so it's a good surprise, but I also think it may now slow the pace of rate cuts."

GENE GOLDMAN, CHIEF INVESTMENT OFFICER, CETERA INVESTMENT MANAGEMENT, EL SEGUNDO, CA

"The number was phenomenal. It came in well above expectations. The unemployment rate came down and it shows the economy is strong."

"The market is seeing good news as good news. This news today confirms that the economy is on solid footing. I'd view today's initial move in stocks with a little bit of caution because the dollar is strengthening and bond yields are higher,"