Jobs Comes in Well Above Consensus, Diving Into Different Views of Our Research Departments

Good Evening:

Markets had a strong week after the 4th of July holiday although light volume during peak summer vacation time likely kept a lid on big moves. The market has quietly drifted up 5% in the last three weeks which has been among the longest uninterrupted rallies of 2022 so far. There is some reason for hesitance as to whether THE bottom is in yet. However, given the persistence of selling and the scale of multiple compression there seems to be an improving risk/reward for stocks given historical precedents.

This morning the Jobs report cast some dispersion on those fearing a vicious slowdown. On the jobs front, at least, there is still a lot of strength. Payrolls grew by 372,000 which was expecting only 250,000. The headline unemployment rate remained at 3.6%. Some decelerating in key economic indicators had some pundits suggesting that we could be currently in a recession. This seems less likely given the persistent strength in the labor market. Average hourly earnings also increased and are up 5.1% from a year ago, so for the time being, wage pressures remain on the strong side. We do see some leading indicators suggesting that labor markets should begin cooling.

Looking under the hood you can already see signs that labor markets, which are very consequentia...

Unlock this article with a FREE 30-Day Trial!

An FSI Pro, or FSI Macro subscription is required in order to access this content.

*Free trial available only on a monthly plan

Disclosures (show)

Get invaluable analysis of the market and stocks. Cancel at any time. Start Free Trial

Articles Read 2/2

🎁 Unlock 1 extra article by joining our Community!

You’ve reached your limit of 2 free monthly articles. Please enter your email to unlock 1 more articles.

Already have an account? Sign In

Want to receive Regular Market Updates to your Inbox?

I am your default error :)