US Job Openings Top Forecasts, Keeping Pressure on Fed to Hike

Sven

Bloomberg is behind a paywall. Get to read few news on Apple News.

US companies added more jobs than expected in December, driven by small- and medium-sized businesses, and highlighting the resilience of labor demand that’s underpinning wage growth. Private payrolls increased 235,000 last month after an upwardly revised 182,000 in November, according to data from ADP Research Institute in collaboration with Stanford Digital Economy Lab. The figure exceeded all but one forecast in a Bloomberg survey of economists.

Treasury yields spiked and US stock futures declined after the release.

https://bloomberg.com/news/articles/2023-01-04/us-job-openings-remain-highly-elevated-at-10-46-million

Sven

Market fell over 1% today due to fear of more rate hikes in coming months.

hank

Sven said:

Market fell over 1% today due to fear of more rate hikes in coming months.

But gained better than 2% today. Fed seems to be trying to splash cold water on the rally of late. But few appear to be listening.

Gold’s closing in on $1900 - highest level in at least a year. Silver’s much more erratic, but running hotter overall. Dollar’s been sliding against some foreign currencies for couple months now - but not in a straight line. EM has turned up as of late. Bonds (investment grade) have been scalding hot this week. If you were “on the fence” a week or two ago you’ve missed a good portion of the bond rally.

Recent Article Re The Fed: https://markets.businessinsider.com/news/stocks/stock-market-crash-fed-interest-rate-cuts-december-meeting-minutes-2023-1

Sven

@old_Joe, Yes, rapid change from day to day. Today the wage growth rate has slowed. So the service cost as one of the inflation indicator is not as bad as it appeared to be on Thursday. Perhaps January’s FOMC will have a smaller rate hike, 25 bps?

Still have small allocation of investment grade bond and bank loan funds. Surprise that gold is making a come back. Must be due to bitcoin taking big hit last year.

hank

Feeling “Whiplash” anyone?

James Stack notes in his January 9 update to subscribers that day to day volatility (S&P) over past 12 months is the 3rd highest in the last 60 years. It is exceeded only by 2008 and 2002.

Wow. I thought it was just me getting “jumpy”.

Can anyone explain why with all this volatility the VIX remains at relatively low readings?

yogibearbull

Some are looking for crash-level VIX of 45-80 before the bear market ends. IMO, VIX remains elevated; it was elevated throughout 2022.

VIX of 21.13 means daily SP500 volatility of +/- 1.11% most of the time and +/- 2.22% or +/- 3.33% some of the time (in the next 30 days).

For VXN (Nasdaq Comp) of 26.96, that means +/- 1.42% most of the time and +/- 2.82% or 4.26% some of the time.

That is plenty of volatility.

MOVE is more relevant for bonds and that is also elevated.

https://stockcharts.com/h-sc/ui?s=$VIX&p=D&yr=1&mn=0&dy=0&id=p88970521030

DavidF

Sven said:

Surprise that gold is making a come back. Must be due to bitcoin taking big hit last year.

Gold has been a mirror image (inversely) of US Dollar.

https://stockcharts.com/freecharts/perf.php?$USD,$GOLD

yogibearbull

BTW, gold volatility GVZ has collapsed as physical gold and gold-miners have moved up quietly. Remember, when gold is near highs or lows, its volatility will jump sharply. It has been in the news that many global central banks have been accumulating gold for diversifying their reserves.
https://stockcharts.com/h-sc/ui?s=$GVZ&p=D&yr=1&mn=0&dy=0&id=p69180341751

hank

Thanks @yogibearbull for clearing it up. My limited perception came from looking at TAIL. Supposed to hedge against volatility. Didn’t help me any when I held it early in 2022. Just looked and it’s down 10-11% for past year. As LB noted for me way back, the bond holdings were what was hurting it. But interesting nonetheless with all the volatility now.