The US stock market experienced a modest upswing over the past week, with the S&P 500 reaching new record highs as investors analyzed signs of decreasing inflation and robust economic growth. The S&P 500 and Dow Jones Industrial Average both rose around 0.7%, while the Nasdaq Composite saw a 1% increase.
In the coming week, market attention will shift to the September jobs report, which is expected to provide valuable insights into the labor market’s cooling pace. Additionally, updates on job openings, services and manufacturing sector activity, and consumer confidence will be closely watched. Notable company-specific events include Tesla’s delivery update and Nike’s quarterly earnings report.
The latest reading of the Federal Reserve’s preferred inflation gauge indicated that price increases are slowing down towards the central bank’s 2% target, shifting focus to its other mandate: maximum employment. Federal Reserve Chair Jerome Powell stated that the labor market is in “solid condition,” and the central bank is cutting interest rates to maintain this status. However, there are signs of a slowdown in the labor market, with the unemployment rate rising to 4.2%, near its highest level in almost three years.
Consensus expectations suggest a gradual cooling of the labor market rather than a rapid slowdown. The September jobs report is anticipated to show 130,000 nonfarm payroll jobs added to the US economy, with the unemployment rate holding steady at 4.2%.
In company news, Nike is expected to report quarterly revenue of $11.65 billion and earnings per share of $0.52, both representing year-over-year declines. The release will mark Nike’s first earnings report since the announcement of Elliott Hill as its new CEO.
Tesla’s stock has been quietly rising, with shares up over 24% in the past month. The electric vehicle maker is expected to announce its third-quarter delivery numbers, with analysts predicting around 462,000 cars delivered.
The Federal Reserve’s recent interest rate cut has boosted investor confidence, with stocks largely trending upward. However, a poor jobs report could have the opposite effect on the market. The upcoming labor market data will provide crucial insights into the Fed’s motivations behind its rate cuts and the overall health of the economy.
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