SCHA News and Press, Schwab U.S. Small-Cap From 01/06/23

Summary The US added 223,000 jobs and the unemployment rate returned to cycle lows, but there are signs that a turn is coming. A fifth consecutive drop in temporary help employment is a warning signal while softer wage inflation suggests labour market dynamics are shifting. With bus...

Summary The Fed's objective is a 4.4% unemployment rate to relieve the jobs-worker gap. The December unemployment rate is 3.5%. Thus, the Fed is likely to remain hawkish, which is opposite what the market currently expects. The Upcoming Recession The recession is coming. H...

Summary The DJIA produced a golden cross four weeks ago. Dow stocks are breaking out all over the place. The S&P 500 looks to be headed for a "golden cross." The market is now looking for an end to rate hike cycle in spring of this year. Now, it looks like the growth stocks ...

Summary Among the key components of the services composite index, the business activity index plunged 10.0 points to 54.7. Backlogs of orders in the services sector likely grew again in December though the pace is weak as the index decreased to 51.5 percent from 51.8 percent. Should...

Summary Total nonfarm payrolls posted a 223,000 gain in December versus a 256,000 rise in November. The results among the various industries were generally positive in December, though just two industry groups, healthcare and leisure, accounted for 64 percent of the net gain for the mon...

Summary The job data suggests the Fed continues to raise interest rates. The ISM data suggest the economy is heading for recession. The equity market still thinks bad news is good news, which is wrong. The December jobs data suggests the Fed's path to higher rates remains on t...

Summary In this article, we discuss a rather bullish job report for December. Job gains and wage growth were strong, yet not too strong to pressure the Fed more than needed. Unfortunately, economic growth is slowing, while inflationary wage growth remains an issue. The Fed knows this an...

Summary Will a decent payroll report be enough to save this rally? The market is caught between a rock and a hard place, but we could see a substantial move soon. I remain cautious, and implementing hedges seems wise here. The next few trading days should be interesting, but we ...

Summary The rate of job growth continues to decelerate, but not to the extent that it undermines the expansion. Wage growth fell sharply to 4.6% and the workweek shrank for a second month in a row. This alleviates upward pressure on inflation and give the Fed more reason to pause it...

Summary Initial claims dropped all the way down to 204K this week. Although both initial and continuing claims had strong showings, there is the caveat that the current period was smack dab in the middle of the holidays. Continuing claims improved falling to 1.694 million instead of...