John Hancock: Weekly Market Recap Week Ended November 21

Labor market shows mixed signals
A delayed September employment release indicated that job growth was stronger than anticipated heading into the government shutdown. Employers added 119,000 positions, outpacing expectations, yet the unemployment rate edged up to 4.4%, marking its highest reading since late 2021.

Markets react to shifting Fed expectations
Interest-rate sentiment swung sharply during the week. By Friday afternoon, futures markets were reflecting about a 72% chance of a quarter-point rate cut at the Federal Reserve’s December 10 meeting. This was a notable jump from roughly 30% just two days prior, contributing to heightened short-term volatility.

Corporate profitability climbs
As third-quarter earnings season concluded, data from FactSet showed that S&P 500 companies posted an average net profit margin of 13.1%—the highest level recorded since the firm began tracking margins in 2009. It also surpassed the previous record set in mid-2021, marking the seventh straight quarter of margin expansion.

Treasury yields ease lower
U.S. government bond yields pulled back late in the week following remarks from a Federal Reserve voting member that strengthened expectations for a December rate cut. The 10-year Treasury yield slipped to 4.06%, down from 4.15% the week before.

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