Equity Markets Closed Lower Last Week

The markets closed lower last week as investors reacted to the possibility of additional tariffs from the Trump administration, the potential for rising inflation, a weak earnings report from a major megacap, and a lower-than-expected jobs report. Of the major benchmark indexes, only the Global Dow managed to eke out a weekly gain. The remaining indexes closed lower, led by the Dow and the NASDAQ. Ten-year Treasury yields rebounded last Friday, but not enough to keep them from ending last week lower. Crude oil prices declined nearly 3.5%, primarily due to increasing trade tensions, particularly with China.

January Jobs Data Missed Expectations

There were 143,000 new jobs added in January, which fell short of expectations. However, upward revisions in November (+49,000) and December (+51,000) combined to account for 100,000 new jobs. The unemployment rate dipped 0.1 percentage point to 4.0% in January, and the total number of unemployed changed little at 6.8 million. The number of long-term unemployed (those jobless for 27 weeks or more), at 1.4 million, declined by about 100,000 in January and accounted for 21.1% of all unemployed persons. Last month, both the labor participation rate (62.6%) and the employment-population ratio (60.1%) ticked up 0.1 percentage point.

Eye on the Week Ahead

Inflation data for January is available this week with the release of the latest Consumer Price Index report. December saw prices rise 0.4% for the month and 2.9% for the 12 months ended in December.