So much for the jobs report sell-off?
Stocks surged despite more evidence of a strong labor market and persistent inflation.
I guess investors didn’t want to go into the sorta long weekend (the bond market is closed, along with government offices, schools, etc. for Columbus Day/Indigenous Peoples’ Day but the stock market is open) on a down note after all.
The September jobs report initially spooked Wall Street, sinking stocks and lifting bond yields. But as the day progressed, the market enjoyed a solid rally. Why?
It could be that investors are finally recognizing that good economic data is good news, no matter what it means for the Federal Reserve and rate hikes. Corporate America is still hiring. (I’m available by the way if any media/financial firms are interested.) Wage growth is strong but starting to cool off a bit, which should ease inflation fears.
So is the worst of the late summer/early autumn stock sell-off over? Perhaps. Pay attention to what big companies say next week though. Earnings have remained pretty solid this year, but we’re about to get a big dose of third quarter results, combined with guidance for the fourth quarter and 2024 outlooks.
Pepsi, Delta, Walgreens, Domino’s, UnitedHealth, JPMorgan Chase, BlackRock, Progressive, Citigroup, Wells Fargo and PNC all are on tap to report next week. If these companies hint at any sort of slowdown in consumer and corporate spending, then the bears could awaken from their brief hibernation.