John Hancock: Weekly Market Recap Week Ended November 1

Jobs disappointment

The labor market weakened in October, as the 12,000 jobs that were added was far short of the previous month’s strong result and marked the smallest increase since December 2020. In addition, initial jobs gain figures for August and September were revised downward. The unemployment rate was unchanged at 4.1%.

Solid GDP gain

The U.S. economy largely maintained momentum in the third quarter despite recently high interest rates and continuing concerns about inflation. While the latest quarter’s annual GDP growth figure of 2.8% was slightly below the second quarter’s 3.0% reading, it was well above the 1.6% first-quarter rate.

Inflation moderation

The U.S. Federal Reserve’s preferred inflation gauge showed further slow-but-steady easing of price pressures. The Personal Consumption Expenditures Index rose at an annual rate of 2.1% in September, down from 2.3% in August and the lowest figure since February 2021. Excluding energy and food prices, the core PCE Index rose 2.7% in September.

Fed ahead

In addition to Tuesday’s U.S. election, the week will bring a two-day U.S. Federal Reserve meeting that’s scheduled to conclude on Thursday—a departure from the Fed’s typical Tuesday-Wednesday cycle for policy meetings. It’s widely expected that the Fed will approve an interest-rate cut of a quarter percentage point as a follow-up to the half-point cut that it made in September.

Source: www.jhinvestments.com