And in lighter news, the co-founder of digital bank Monzo has quit to pursue an alternative career: farming alpacas in Northumberland.

In an announcement on his LinkedIn page, Paul Rippon announced that after 27 years in financial services he and his wife will be farming full-time.

With no farming background or experience we now have over 300 alpacas and welcome many visitors to our farm and holiday cottages.

For the next few weeks and months I’m going to enjoy some time with Debbie at our wonderful farm in Northumberland.

You’ll find me doing the feed rounds, hosting alpaca walk ’n’ talks and driving my tractor (a Massey Ferguson 390T if you like that sort of thing - otherwise it’s big and red!).

Sometime after April 2020 I plan to spend a day a week doing non-executive, consulting or coaching; the rest of the time will be reserved for Debbie, our alpaca farm and enjoying life.

The proof is in the chart: here you can see how US annual wage growth has held up above 3% between summer 2018 and November 2019.

The FT (£) caught on to a notable statistic: this first time that US wage growth has dropped below 3% since July 2018.

For those of you who saw the earlier tweet, it’s now been revised. (I’ve deleted the previous version in the blog to avoid confusion...)

Steen Jakobsen, chief economist at Saxo Bank, says the biggest question arising from the US December jobs figures is why wage growth is slowing:

The disappointing jobs figures appear to have dimmed excitement about a potential new record for the Dow, which some have said could push above 29,000 for the first time today.

US stock futures have pared their gains:

• Dow futures are now flat
• S&P 500 futures are now up about 0.1%

Sam Cooper, a vice president at Silicon Valley Bank, comments on the US non-farm payrolls report:

Today’s underwhelming report will inject some life into relatively quiet markets as the headline jobs number narrowly missed expectations and wage growth also disappointed.

While participants appear to be focused on trade and geopolitical tensions, the disappointing data will be a concern for participants sitting on large dollar balances and could put the brakes on the momentum behind a strengthening dollar.

The surprise will likely spur some additional volatility to an already nervous GBP-USD however is unlikely to effect the long term view of the Federal Reserve who appear content with the current state of the labour market.

More details on US jobs figures:

The unemployment rate has remained steady at 3.5%, which is in line with forecasts.

But average earnings have risen year-on-year by 2.9% though that is lower than estimates for a 3.1% rise.

Less than 30 minutes until US non-farm payrolls, which are forecast to come in around 164K, according to consensus figures from Refinitiv.

Neil Wilson, chief market analyst for Markets.com, warns that a weak reading for US jobs could result in a quick response from the Federal Reserve and could spark a drop in the value of the dollar:

Remember last month a blowout jobs number sent equities higher along with the US dollar and Treasury yields, as it suggested the US economy was doing better than many corners of the market feared.

The headline print was miles ahead of expectations, coming in at 266k vs 180k expected. Unemployment at 3.5% was exceptionally strong, too. September was revised up 13k to 193k, while October was also revised higher by 28k to 156k. Private payrolls also very strong at 254k.

Should we worry about the Fed pivoting again? I don’t think so and the market clearly thinks the same.

The Fed can stand this sort of hot reading for a while yet – jobs growth is averaging only 180k this year vs 223k last year. And whatever privately you might think about whether the Fed should be maintaining an easing bias in this environment, it’s made it very clear that it will take a sustained and pronounced rise in inflation to warrant a hike.

The Fed has made it clear it will let inflation and the economy run hot, so today’s numbers can’t really miss as far as equities are concerned. A weak reading only raises prospect of quicker policy response and may lead to the USD handing back some of the recent gains.

The FTSE 100 appears to be losing some of its shine and is just holding its head above water, up just 0.1%.

Some of the stocks dragging on the index include:

• Kingfisher down -2.6%
• Mondi down -2.5%
• Lloyds Banking Group down -2.3%
• J Sainsbury down -2%

Sainsbury’s decline comes after discount supermarket Lidl emerged as one of the winners of the Christmas shopping season, logging an 11% rise in total sales over the 4 weeks to 29 December. Earlier this week, Sainsbury’s said like-for-like sales (excluding fuel) slipped 0.7% in the 15 weeks to 4 January.

Mondi, the paper and packaging firm announced this morning that its chief excutive Peter Oswald is stepping down after just three years in the role, but did not disclose the reason for his departure. The industry has suffered a drop in demand for paper including newsprint, but is also producing more packaging for parcels for online shopping deliveries.

David Madden, a market analyst at CMC Markets UK, says US unemployment is expected to hold at a 50-year low of 3.5% for December:

The mood is muted this morning as traders await the US non-farm payrolls report at 1.30pm (UK time). The consensus estimate is that 164,000 jobs were added last month, which would be a decent number, but keep in mind that 266,000 jobs were added in November.

The unemployment rate is at a joint 50-year low of 3.5%, and it is tipped to hold steady. Average earnings are expected to remain at 3.1%.

It is clear the US labour market is in rude health, so the wages component will be of extra importance as realistically, the jobless rate is unlikely to fall much more without a rise in the earnings reading.

If companies are struggling to fill vacancies they might have to offer higher wages to attract potential workers. A solid earnings reading should bode well for the economy as people who earn more tend to spend more – which drives the economy along.

Boeing shares are up 0.19% in premarket trading despite fury over internal messages released by the company that have raised questions about its development of the 737 Max.

That model was grounded in March following two fatal crashes that killed 346 people.

Instant messages dating back to April 2017 showed two employees complaining that “This airplane is designed by clowns who in turn are supervised by monkeys.”

The FT (£) has pulled out a few more damning quotes suggested staff may have been trying to cover up problems from the regulators at the Federal Aviation Administration.

“I still haven’t been forgiven by God for the covering up I did last year,” an employee said in a 2018 message. Another from the same year said they were not sure “if I will be returning in April given this — am not lying to the FAA. Will leave that to people who have no integrity.”

“I’m sorry, that is not acceptable,” another employee responded. “Your integrity is priority 4.”

Members of the US Congress have called the messages “incredibly damning”:

Bank of England ratesetter Silvana Tenreyro has signalled that she would be prepared to cut interest rates soon if recent weakness in the British economy amid Brexit uncertainty persists.

Speaking at an event held by the Resolution Foundation in London, the member of the Bank’s monetary policy committee says there are some reasons for optimism since the general election, but that she sees plenty of reasons for caution too, and that the risks are “largely to the downside.’’

“If uncertainty over the future trading arrangement or subdued global growth continued to weigh on UK demand then my inclination is towards voting for a cut in bank rate in the near term,” she says.

Her comments come after Mark Carney indicated on Thursday that the Bank could cut rates if necessary.

Tenreyro says unless there are any signs of a pick-up in the jobs market soon, weaker wage growth will mean inflation in Britain should remain below the Bank’s 2% target rate set by the government - another big hint that interest rates are more likely to be cut than raised.

Though the jobs market starts the year in relatively reasonable health, she adds: “The labour market will probably not tighten further and is now showing some signs of softening.”

Oil prices have retreated to levels last seen before Christmas.

Following US strikes which killed Qassem Suleimani last week, Brent crude prices climbed above $70 for the first time in four months.

But with fears over a potential disruption to supplies due to rising fears of conflict between Washington and Beijing now subsiding, we’re now back to around $65 per barrel.

The Dow Jones Industrial Average could break above 29,000 for the first time today.

That’s the forecast by Jasper Lawler, head of research at London Capital Group. He says markets are “throwing caution to the wind” when it come to the US and Iran, though the tragic downing of the Ukrainian plane over Iran could end up being another “flashpoint.”

But with attention now turning to the US-China trade pact, we could be in for another day of record highs for US equities:

US President Donald Trump has said the US- China trade deal is to be signed January 15. The direct benefits of more amicable relations between the US and China are plain to see in reports of rising iPhone sales in China and new record highs for the Apple share price.

Apple is leading the charge taking the Dow Jones above 29,000 for the first time.

Of course other factors like seasonality and new model releases play into it, but the easing of widely-reported anti-US sentiment in China against Apple because of the trade war is important.

An update has been issued on the winding up of the Woodford Equity Income Fund.

Its administrator Link Fund Solutions says BlackRock has raised around £1.9bn through the sale of assets, which represents around 63% of the value of the total fund.

(Woodford’s flagship fund, once worth more than £10bn, fell below £3bn as investors rushed to withdraw their money after a series of poorly performing stock picks, last year)

Park Hill is in charge of a separate portfolio of less liquid assets. No update has been issued on that part of the fund, except to say that Link continues to work with the firm to “explore opportunities for the sale of assets within Portfolio B.”

Link has also notified investors that there will be a 10 day delay in paying returns to investors, with the date moving from 20 January to 30 January:

This change to the timetable is required to ensure that investors retain exposure to the equity market for the entire period prior to the Fund being wound up as required by the regulations. This delay also allows a significant portion of the Fund’s holdings in money market instruments to be liquidated in a way that minimises costs to the Fund.

You can read the full investor update here.

That is unlikely to spur excitement among investors who heard that former star stockpicker Neil Woodford and his business partner pocketed £13.8m in dividends from their investment management company last year.

Last month 300,000 investors were told they had lost nearly a fifth of their money and that selling the remaining assets was proving more difficult than expected.

Michael Hewson, chief market analyst at CMC Markets UK says the de-escalation in the Middle East has allowed traders to re-focus on positive news around next week’s signing of the US-China trade pact (at least the first phase of it...)

They say a week is a long time in politics, and this week it’s also been true for financial markets, given some of the hyperbolic talk of World War Three that was doing the rounds early on Monday morning.

In the space of a few days we appear to have swung full circle; with investors seemingly convinced that the problems in the Middle East appear to have settled down, at least for the time being.

While that seems a big assumption to make it would need a significant escalation now for the current rebound to come full circle, and while it would be unwise to rule that out, investors have been rotating into gold as a precaution, in addition to buying back into stocks, just in case.

Hewson added:

With this week’s geopolitical risk subsiding as we head towards the weekend, investors now have the opportunity to focus on the signing of the signing of the new US, China phase one trade deal next week, as well as the health of the US economy today, and in particular the labour market which has continued to look resilient.

Airlines are leading the UK markets after Ryanair upped its forecast, following a busier-than-expected Christmas and New Year travel period.

Ryanair shares are up 8.5% on the news which also lifted competitors to the top of the FTSE 100: EasyJet is up 5.6% while British Airways owner IAG is up 4.4%.

Ryanair said it expects to carry a million more passengers across the year than the 153m it had forecast, thanks to strong forward bookings for the January to April period, which are up 1% year-on-year.

“On the basis of current trading, Ryanair expects to finish close to the mid-point of this new range,” the company said.