Weekly Market Report for January 30-February 3, 2023

Weekly Market Report for January 30 – February 3, 2023

• Markets
  • S&P 500   +2.1%
  • Dow Jones Industrial Average   +0.1%
  • NASDAQ   +4.1%
  • Russell 2000   +4.4%

Domestic equity markets finish the week higher as the Federal Reserve slowed rate hikes to 0.25%. Federal Reserve Chairman Jerome Powell hinted at a rate hike pause following the March meeting of the Federal Open Market Committee. The news propelled stock markets higher. Other news that provided a boost to markets was the fact that the Challenger, Gray, and Christmas January Job Cuts Report showed over 102,000 job cuts during the month of January. While you and I view this as troubling, the Fed views it as a sign its rate hikes are working. One data point is still sending mixed signals, and it’s the labor market. From a Fed perspective, job cuts are moving in the right direction. The Job Openings and Labor Turnover Survey (JOLTS) showed a higher than expected 11 million job openings, which equates to 1.9 jobs for every one unemployed person. The Fed would like to see this number closer to 1.15, as more jobs available means employers must increase wages to attract workers which means business then increase the prices they pass on to customers to account for the higher wages they paid to attract workers.