Happy Friday, investors. This morning brings news of the most important economic data ever — at least until the next jobs report is due. While market-watchers say this every month, the stakes today do feel particularly high for the Fed, investors, and everyday Americans.

The Federal Reserve finally has the data it needs to start cutting rates, and that’s particularly welcome news for job seekers across the US.

The labor market has deteriorated for months and Wall Street expects the latest jobs report to confirm the trend. Economists expect the US added 80,000 non-farm jobs in August, according to FactSet.

That would be just above July’s 73,000 gain, yet well below the trailing 12-month average of 128,000. 

The unemployment rate is projected to hold steady at 4.2%.

“The Federal Reserve’s free pass on the labor market has ended,” said Jamie Cox, managing partner for Harris Financial Group.

A series of weak labor market reports this week has already bolstered expectations for policy easing:

Initial jobless claims now hover at a three-year high, July’s jobs reports saw historic revisions, and the ratio of job-seekers to available jobs continues to fall.  

Taken together, the numbers have markets convinced that the central bank will cut rates on September 17.

Traders now see nearly a 98% probability for a 25-basis-point rate cut, up from 86% one week ago. Prediction market bets have similarly ramped up to near-certainty.

Recall that President Trump removed the head of the Bureau of Labor Statistics after the July data release, which included revisions to May and June that erased a quarter-million jobs.

In any case, equities, for their part, have remained resilient in the face of labor market strain.

Benchmark indexes continue to hover near record highs, buoyed by strong corporate earnings and anticipation of lower rates. 

But even optimistic, forward-looking markets can only look past a faltering labor market for so long.

“A good deal of the ‘American Exceptionalism trade’ has been predicated on the notion of a resilient, almost recession-proof, US labor market, but [the] JOLTS report is a crack in that foundational idea,” said DataTrek Research co-founders Nicholas Colas and Jessica Rabe.

“It is too early to say that this dynamic is gone forever, but Friday’s Jobs Report just became even more important to investor confidence in the US economy.”

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🚀 Broadcom stock popped in after-hours trading. Shares have nearly doubled over the last year as part of the AI wave. The company beat earnings expectations, provided robust guidance, and secured $10 billion in orders from a new client for custom chips. (CNBC)

🏦 Fed Governor Lisa Cook is “misguided” on her stance. That’s according to President Trump’s lawyers, who are pushing back on Cook’s bid to temporarily block her removal from the central bank. To Trump’s legal team, Cook’s standing on suspect legal grounds. (Barron’s)

📈 Gold can hit $5,000 next year, according to Goldman Sachs. Should Fed independence come under further threat, it could push beyond its current highs, the strategists said. The metal is up more than 5% over the last week. (Yahoo Finance)

🦅 American Eagle notches best trading day ever. Ad campaigns with Sydney Sweeney and Travis Kelce helped propel the bottom line for the business and virality on the internet for the classic retailer. The stock traded more than 35% higher Thursday. (USA Today)

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📰 I’m Phil Rosen, co-founder and editor-in-chief of Opening Bell Daily. I’ve published books, lived on three continents, and won awards for my journalism, which has appeared in Business Insider, Fortune, Yahoo Finance, Bloomberg and Inc. Magazine.

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