Equity Markets Mixed Last Week on Split Economic Data 

The stock market declined for most of last week, only to rally last Thursday and Friday. The last two weeks have been “catch-up” periods for the economy with the release of a large influx of economic data following the 43-day government shutdown. While last week started with heavy selling, particularly in the tech sector, a cooler-than-expected Consumer Price Index last Thursday helped drive the market higher. The S&P 500 and the NASDAQ ended the week higher, while the Dow, the Global Dow and the small caps of the Russell 2000 closed down. Of the 11 S&P 500 market sectors, only Consumer Discretionary and Health Care outperformed. The remaining sectors closed the week in the red, with energy falling nearly 4.0%. Crude oil declined for a second straight week, with prices falling to their lowest levels in nearly five years, as concerns over a global supply glut and trade tensions outweighed geopolitical risks. Despite unemployment rising, evidence of waning inflationary pressures is leading some analysts to suggest a “Santa Claus” rally (historically occurring over the last five days of December) is in the offing.

Unemployment Ticked Higher; CPI Slower Than Expected in November

The latest jobs report showed that the labor market grew by 64,000 in November, in line with most expectations. The change in total employment for August was revised down by 22,000, and the change for September was revised down by 11,000. With these revisions, employment in August and September combined was 33,000 lower than previously reported. The unemployment rate in November, at 4.6%, was 0.2 percentage point above the September rate and 0.4 percentage point above the November 2024 estimate of 4.2%. The total number of unemployed, at 7.8 million, was 700,000 above the estimate from a year earlier. The labor force participation rate was 62.5% last month, while the employment-population ratio was 59.6%. Each of these measures has shown little change over the year. The number of long-term unemployed (those jobless for 27 weeks or more) changed little at 1.9 million in November and accounted for 24.3% of all unemployed people. In November, average hourly earnings edged up by $0.05, or 0.1%, to $36.86 from September. Over the past 12 months, average hourly earnings have increased by 3.5%. The average workweek increased 0.1 hour to 34.3 hours in November.

The Consumer Price Index (CPI) increased 0.2% over the two months from September 2025 to November 2025. The CPI less food and energy also rose 0.2% over the same two months. From September to November, shelter prices increased 0.2%, energy prices rose 1.1% and food prices increased 0.1%. Other indexes that increased over the two months ended in November include household furnishings and operations, communication and personal care. In contrast, the indexes for lodging away from home, recreation and apparel decreased over the same two-month period. Over the last 12 months, the CPI increased 2.7% after rising 3.0% over the 12 months ended in September. Prices less food and energy rose 2.6% over the last 12 months. Energy prices increased 4.2% for the 12 months ended in November. Prices for food increased 2.6% over the last year. The Bureau of Labor Statistics did not collect survey data for October 2025 due to a lapse in appropriations.

Eye on the Week Ahead

Tuesday is a busy day for economic data, headlined by the release of the preliminary estimate of gross domestic product for the third quarter. The Bureau of Economic Analysis is releasing two estimates of third-quarter GDP (the preliminary and final versions) instead of the customary three iterations over three consecutive months. The advance estimate, initially scheduled for an October release, was not provided due to the government shutdown.