Bloomberg Evening Briefing: US Job Openings Are Beginning to Cool


US companies added fewer jobs than forecast in October, suggesting demand for workers in what’s been a historically strong American labor market may be starting to wane. Private payrolls increased 113,000 in October after posting the weakest advance in two years the month before, according to figures published Wednesday by the ADP Research Institute in collaboration with Stanford Digital Economy Lab. The median estimate in a Bloomberg survey of economists called for a reading of 150,000. Nevertheless, job gains continued and were broad across US industries, led by education and health services as well as trade and transportation. “No single industry dominated hiring this month, and big post-pandemic pay increases seem to be behind us,” said Nela Richardson, chief economist at ADP. “In all, October’s numbers paint a well-rounded jobs picture. And while the labor market has slowed, it’s still enough to support strong consumer spending.” In other words, just the kind of news the Federal Reserve has been looking for in its bid for a soft economic landing.

On Wednesday, the Fed unsurprisingly kept steady on interest rates, but investors reading Jerome Powell’s tea leaves divined a potential end to further hikes. As far as stocks are concerned, just the other day one of Wall Street’s biggest bears broke the bad news that the fourth quarter wouldn’t see a rally. That may be so, but a contrarian signal is now forecasting better news over the next year. Bank of America’s “Sell-Side Indicator” is approaching a level that indicates an extreme degree of bearishness that is in fact bullish for stocks. The gauge’s current level implies a 15.5% price return for the S&P 500 Index over the next 12 months. Here’s your markets wrap.


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