The market is entering a critical juncture, focused on two near-term catalysts:
the upcoming employment data and the Supreme Court’s decision on the legitimacy of tariffs.
Together, these factors will shape expectations for growth, rates, and capital flows.
1. Employment: Solid but Clearly Cooling
The labor market remains resilient, but the trend is unmistakably one of cooling rather than acceleration.
A key metric confirming this is the job opening to unemployment ratio, which measures how many open positions exist per unemployed person.
| Sector | Jan 24 | Jan 25 | Nov 25 |
|---|---|---|---|
| Total Private | 1.41 | 1.17 | 1.10 |
| Manufacturing | 1.07 | 0.83 | 0.78 |
| Financial Activities | 2.47 | 2.68 | 1.51 |
| Professional & Business Services | 1.90 | 1.36 | 1.51 |
| Private Education & Health Services | 3.28 | 2.43 | 1.70 |
A ratio above 1.0 indicates a hot labor market. While high value-added positions remain in demand,
availability is increasingly constrained. In contrast, medium- to low-value-added sectors show ratios closer to
0.70 or below, highlighting softer demand.
Continuing Jobless Claims (Monthly Average)
- July 25: 1,950
- August 25: 1,942
- September 25: 1,923
- November 25: 1,920
- December 25: 1,899
Over the past six months, continuing claims have improved by approximately 2.62%,
reinforcing the view of stability rather than deterioration.
The most important indicator remains average weekly earnings growth,
currently estimated at just +0.1%.
This low figure would confirm declining real purchasing power, pushing it below 1% year-on-year.
The only mitigating factor is December CPI data, where energy prices fell by 3–4%
month-on-month and mortgage rates remained unchanged. This keeps the monthly earnings forecast
in a narrow +0.10% to +0.15% range.
Conclusion on employment: even a +0.1% increase in the unemployment rate
would not materially alter the overall employment picture.
2. Supreme Court Decision on Tariffs
The Supreme Court’s ruling on the legitimacy of tariff-related measures represents a binary risk for markets.
A negative verdict would be extremely disruptive, calling into question Treasury Bill budgeting and the
feasibility of repaying additional excise-tax revenues, with direct consequences for interest rates.
Given that the Court’s majority leans Republican, a decision that would fundamentally damage the American
financial system appears unlikely. However, a symbolic warning aimed at limiting aggressive policy “exits”
could still emerge, introducing short-term volatility.
Market Positioning and Currency Signal
Equity markets remain under the influence of strong tech and AI euphoria.
Biotech has also risen sharply, largely due to the lack of credible alternative growth sectors.
Warning signal: the U.S. dollar is recovering against both the euro and the yen.
This is the first indication that foreign capital is once again flowing into U.S. assets,
initially into bonds but increasingly into equities.
This currency move suggests that, despite macro uncertainties, the U.S. market continues to be perceived
as the primary global destination for capital.