Overview
The U.S. stock market rose today as it reacted to signs of a slowing labor market coupled with anticipation of interest rate hikes. The S&P 500 index reached a new all-time high for the 7th time. Investors are paying close attention to today's employment report. The ADP private employment number increased by 54,000, below market expectations. Weekly new jobless claims rose to their highest level since June, further signaling a cooling labor market.
| Nasdaq Composite | S&P 500 |
| Dow Jones Industrial Average | 1 South Korean won equals |
A Major News Story
The most notable market news centered around the August Services PMI, which hit its highest level in six months, showcasing robust growth in the service sector. Despite this positive data, the market focused more on signs of labor market cooling. Experts believe that this data provides the Federal Reserve with adequate justification for a potential rate hike in September, although they do not consider the situation severe enough to predict a recession.
Economic Indicators for Tomorrow
| Release Time | Event Description |
| 10:30 PM | U.S. August Non-Farm Employment Report |
| 10:30 PM | U.S. August Unemployment Rate |
| Midnight | U.S. Baker Hughes Total Rig Count |
A General Opinion
Investors are in a situation where the Federal Reserve might not be fully convinced of the labor market's slowdown. Steve Sosnick indicated that considering the Fed's dual mandate, tomorrow's employment report will be the most critical single data point. It is ideal if the labor market reflects a moderate slowdown without reaching a concerning level. On the other hand, Jamie Cooks of Harris Financial warned that the Federal Reserve can no longer be complacent about the labor market situation. In contrast, Chris Lackey emphasized that while the data confirms labor market cooling, if it worsens significantly, it could trigger concerns about economic robustness. Meanwhile, Eunyoung Yoo maintained a cautious stance, suggesting that a rate hike could be appropriate.
