How stock-market bulls risk getting caught off guard by another ugly jobs report

With bullish investors pinning their hopes on a rebound in U.S. and global growth, few appear prepared for a second dismal jobs report in a row.

The strength of U.S. households has been a widely shared article of faith among stock-market investors betting on the economy to power through its recent trough, helping equities and corporate bonds rebound strongly in the first quarter. This conviction helped Wall Street shrug off fears February’s unusually soft jobs data was a portent of economic trouble.

But if nonfarm payrolls, which are due for release Friday morning, come in much weaker than expected in March, it could help unravel investor optimism that the U.S.’s recent slowdown is only a soft patch.

“If we get anything remotely close to the 20,000 gain in February, that would be a very big concern to markets, and it would suggest the slowdown is deeper and more persistent than expected,” Kathy Bostjancic, director of U.S. macro investor services at Oxford Economics, told MarketWatch.

See: U.S. adds meager 20,000 jobs in February to mark smallest increase in 17 months

Economists polled by MarketWatch forecast the U.S. economy to add 179,000 jobs in March, jumping back from a 20,000 reading in February. Average hourly earnings are expected to increase 0.3%, and the unemployment rate to hold steady at 3.8%.

Fears of softening household spending and a rise in unemployment briefly flashed after Automatic Data Processing Co. reported Wednesday that private-sector employers had added 129,000 jobs in March, versus the forecast of 179,000.

“If employment growth weakens much further, unemployment will begin to rise,” wrote Mark Zandi, chief economist of Moody’s Analytics.

Read: Private sector hiring falls to 18-month low, and manufacturing sheds jobs, ADP says

If “this is the beginning of a weakening of the labor market, the discussion all of

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