Economy
The bad news is we didn't get the October inflation report because the government was shut down. In fact, the White House says we may never see either the inflation data for last month. The Bureau of Labor Statistics did say, however, that they expect to release the last two jobs reports that were unpublished over the next week or so, although it may not release the unemployment rate alongside the nonfarm payrolls. The good news is the shutdown came to an end last week, so we'll be back to our usual stream of economic data soon.
The final Federal Open Market Committee (FOMC) meeting of the year will take place in just under four weeks, and they'll be glad to have some data in front of them as they decide whether or not to issue another rate cut. Interestingly, the market's expectations for a cut in December have really shifted over the last few weeks, and are now suggesting the Fed will not change rates. Fed Chair Jerome Powell suggested as much the last time he took to the podium, saying there was a growing chorus of FOMC voters that wanted to pause here. There's been a concern about possible inflationary effects of the Trump administration's tariffs which has given the Fed enough reason to slowdown the pace of rate cuts. To address rising costs, the administration announced rollbacks of tariffs on certain food goods late this week.
Markets
The S&P 500 was relatively unchanged this week, rising nearly 2% by Wednesday then giving it all back to close the week up 0.08%. We've seen several headlines over the last couple of weeks with Wall Street questioning if tech stock valuations have gotten out of hand and if the AI boom spending craze has gone off the rails. There are also macroeconomic questions about the health of the consumer that exist which have contributed to the recent volatility we've seen in the markets. It's been said that markets climb a wall of worry, so perhaps some of this recent doubt is needed and a pause in the rally is warranted. We'll have a big moment for the market next week when Nvidia announces is quarterly results and gives fresh guidance Wednesday afternoon. No other company is going to be a better indicator on the health of the AI theme that's driven markets higher over the last few years.
What We're Reading
- For a Stress-Free Thanksgiving, Try These Mail-Order Dishes- WSJ
- All Three of the Core Premises Behind the Bull Market Are In Question- Mike Santoli
Have a great weekend.
Dogwood Wealth Management