Investors were confronted with plenty of market-moving information last week as they waded through negative developments and some positive signs. Growing tensions in the Middle East and a slowdown in the manufacturing sector (see below) were causes for concern, while a better-than-expected jobs report (see below) helped alleviate some of those worries, at least for a time. The S&P 500, the NASDAQ, and the Dow ended a very volatile week on the plus side, while the Russell 2000 and the Global Dow closed the week lower. Among the market sectors, energy surged by more than 8.5%, while communication services, financials, and industrials also closed higher. The remaining sectors declined, led by real estate and materials. Ten-year Treasury yields surged to their highest level in nearly two months as the robust labor report cooled expectations that the Federal Reserve needed to aggressively cut interest rates.
Last Week’s Economic News
- The employment sector showed signs of life in September. Total employment expanded by 254,000 last month.
- According to the S&P Global survey of purchasing managers, the manufacturing sector moved deeper into contraction in September.
- While the manufacturing sector may be waning, the services sector is showing strength.
- The number of job openings increased in August, according to the latest data from the Job Openings and Labor Turnover Summary.
- The national average retail price for regular gasoline was $3.179 per gallon on September 30.
- For the week ended September 28, there were 225,000 new claims for unemployment insurance, an increase of 6,000 from the previous week’s level.
Eye on the Week Ahead
The latest inflation data is available this week, with the release of the Consumer Price Index for September. The CPI inched up 0.2% in August and 2.5% since August 2023. Most forecasters predict September’s data should be in line with the data from August.
Have a nice week!
Sincerely,
Robert G. Carpenter