The US stock market has been resilient in November, thanks to strong earnings reports from companies like Amazon and Intel. However, the latest jobs report has shown a mixed picture, with only 12,000 jobs added in October, well below the expected 113,000. External factors like hurricanes and strikes have contributed to this decline. Despite this, the unemployment rate remains steady at 4.1%. The downward revisions of 112,000 jobs over the past two months suggest that the labor market may not be as strong as previously thought.
The upcoming US election is approaching, and the counting of votes will be done by various media organizations, as there is no centralized national ballot-counting body. The timeline for announcing the election winner is uncertain, and delayed results could create volatility in the markets. The uncertainty surrounding the election outcome may lead to cautious trading behavior.
The upcoming Federal Open Market Committee (FOMC) meeting on November 8 is expected to be significant for market participants. After a significant interest rate cut in September, the Fed aims to support the labor market. Economic data since the rate cut has been mixed, leading to a shift in traders' expectations. A more measured approach is anticipated, with a 25 basis point cut expected at the upcoming meeting.
The Nasdaq 100 has faced challenges in maintaining its upward momentum, while the S&P 500 marked its first losing month since April. Technical analysis suggests potential declines in both indices, but as long as critical support levels are maintained, there is a possibility for a retest of record highs.
In summary, the US stock market is navigating a complex landscape with mixed economic signals, an impending election, and a pivotal Federal Reserve meeting. The interplay between economic data, political developments, and technical indicators will be crucial in shaping market sentiment in the weeks to come.