Today the ADP private sector jobs data showed a pretty large upside surprise. The number showed 157K jobs created in the private sector in June compared to just 36K in May. The expectations were around 70K. Muhtar Kent, the CEO of Coca Cola, was on CNBC today morning and said that he thinks the soft patch has ended, although he wasn’t very emphatic. With the reinforcement in sentiment coming from the stock market rally, I think the chances are high the soft patch in the economy might actually be ending. I had never expected this soft patch to turn into a recession but if it has truly ended then the economy is bouncing back a little bit faster than I had expected.
We still have the the official employment report tomorrow and it could throw cold water on the optimism, but I think the chances are good that the employment report might beat expectations.