Markets Up But Off Session Highs: JOLTS, Beige Book Flat

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Market indices closed off session highs today, but the four majors all finished in the green, nevertheless. A nice kickstart in the pre-market launched all four well above Tuesday’s closing levels, but those gains were pared by the end of the trading day today. The Dow grew by 75 points, +0.21%, while the Nasdaq — once again led by its superstar NVIDIA (NVDA) — was up +91 points, +0.58%. The S&P 500 and small-cap Russell 2000 rose +0.51% and +0.62%, respectively.

Private-sector payrolls from ADP (ADP) came in lighter than expected but revealed some less-than-robust elements of the labor market than compared to, say, a year ago. While wages are up slightly, work hours are down. Is the labor market being bolstered by part-time jobs, in many cases second jobs, in order to pay for higher costs of goods and services? And if so, how long that that be expected to keep the strong economy afloat?

The Job Openings and Labor Turnover Survey (JOLTS) report for January came out this morning after the opening bell, with results exactly in-line with expectations — 8.9 million job openings, well off the March ’22 pace of 12.2 million highs — and in-line with the downwardly adjusted previous month. Job quits — a function of how employees feel about their job security — reached 3.4 million, also in-line with the previous month (which was revised higher).

There was also a new Beige Book from the U.S. Bureau of Labor Statistics (BLS), the second of eight so far this year. Results were not radically different from the previous release in mid-January. Eight of the 12 regions saw economic growth in the period (though none described as anything more than “slight” or “modest”), while three regions saw no change and one saw a slight decline. These numbers reflected heightened price sensitivity for consumers, with overall consumer spending coming down somewhat during the period.

Tomorrow morning brings us more economic grist for the mill, with Weekly Jobless Claims expected to stay around where they were last week (215K new claims, 1.9 million longer-term continuing claims) and a revision on Q4 Productivity expected to tick down 10 basis points to 3.1%. The U.S. Trade Balance will also issue is latest numbers, with analysts predicting a slightly deeper deficit than we saw in the same report a month ago. There is a lot to take in here, but once we sift through the meaningful details, we’ll be better off, knowledge-wise, that we were at the start of the week.

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