What Happened Last Week

The S&P 500 Index declined 1.94 percent, the Nasdaq Composite Index declined 2.34 percent and the Dow Jones Industrial Average declined 1.86 percent.^1,2

Inflation Stymies Markets

There was a broad market rally to begin the week, but two economic reports on Tuesday put an end to that. The job openings report and the prices-paid index among service companies numbers raised new inflation concerns for investors. Higher Treasury yields also put pressure on the markets.^3,4

Stocks flattened out on Wednesday. Investors reacted to news that most Federal Open Market Committee members agreed inflation risks had increased, per minutes from the Fed’s December meeting.^5,6

In observance of President Jimmy Carter’s funeral, U.S. stock markets were closed on Thursday.

On Friday, a warmer-than-expected December jobs report caused investors to question whether the Fed will adjust rates in 2025. News that consumer sentiment ticked down also pushed stocks lower.⁷

When Good Becomes Bad News

The economy added 256,000 jobs in December—100,000 more than economists expected. That’s the second-highest monthly job gain for 2024. Unemployment ticked down to 4.1 percent, which was also better than anticipated.

Job growth and lower unemployment signals good news for the economy but bad news for the markets. A stronger jobs market puts less pressure on the Fed to adjust rates, especially while inflation remains top-of-mind among investors.^8,9

Economic Data To Watch

Monday: Treasury Statement.

Tuesday: Producer Price Index. Fed officials Jeffrey Schmid and John Williams speak.

Wednesday: Consumer Price Index. Fed officials Thomas Barkin, Neel Kashkari, John Williams, and Austan Goolsbee speak. Fed Beige Book.

Thursday: Retail Sales. Import and Export Prices. Business Inventories. Homebuilder Confidence Index.

Friday: Housing Starts and Permits. Industrial Production.

^{Source: Investors Business Daily - Econoday economic calendar; January 9, 2025
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

Upcoming Earnings Reports

Wednesday: JPMorgan Chase & Co. (JPM), Wells Fargo & Company (WFC), BlackRock, Inc. (BLK), Citigroup Inc. (C), The Charles Schwab Corporation (SCHW)

Thursday: UnitedHealth Group Incorporated (UNH), Bank of America Corporation (BAC), Morgan Stanley (MS)

^{Source: Zacks, January 9, 2025. Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

Footnotes and Sources

^{1. The Wall Street Journal, January 10, 2025}

^{2. Investing.com, January 10, 2025}

^{3. CNBC.com, January 6, 2025}

^{4. The Wall Street Journal, January 7, 2025}

^{5. CNBC.com, January 8, 2025}

^{6. MarketWatch.com, January 8, 2025}

^{7. CNBC.com, January 10, 2025}

^{8. The Wall Street Journal, January 10, 2025}

^{9. TradingEconomics.com, January 10, 2025}

^{Source: YCharts.com, January 11, 2025. Weekly performance is measured from Friday, January 3, to Friday, January 10. TR = total return for the index, which includes any dividends as well as any other cash distributions during the period. Treasury note yield is expressed in basis points.}