MarketLens
Market Overview
The September jobs report gave the markets a boost on Friday, with the S&P 500 rising by 0.4% and the Nasdaq gaining 0.7%
Here’s a look at the S&P 500 this week and its response to the employment report:
Economic Insights You Need to Know
The unemployment rate dropped to 4.1% from 4.2%, reflecting a positive shift in the labor market. The U.S. added 254,000 new jobs in September, exceeding the 150,000 forecasted and up from the 159,000 jobs added in August.
Looking ahead, the October jobs report may be skewed by the impact of Hurricane Helene, which could disrupt hiring patterns. As the Federal Reserve meets again in early November, this strong September data is expected to play a significant role in shaping the Fed’s decisions.
Crude oil prices surged to $74 per barrel this week due to escalating tensions in the Middle East. Oil traders warn that prices may continue to rise until the conflict deescalates. While current prices are high, they have not yet surpassed the $87 per barrel peak seen in April 2024.
This week saw a major labor dispute resolved as around 45,000 dockworkers from East and Gulf Coast ports secured a 62% wage increase over six years, according to Reuters. This agreement helped avert a prolonged strike that could have led to widespread supply chain chaos. The strike, which started briefly on October 1, was quickly resolved, avoiding what analysts from J.P. Morgan projected could have been $5 billion in economic damage if the closures had persisted.
Stock of the Week: Capricor
Stock of the Week: Capricor Therapeutics Inc. (NASDAQ: CAPR), a biotechnology company, saw its stock soar after announcing it will present key findings from its HOPE-2 trials at the World Muscle Society Congress.
The company is developing deramiocel CAP-1002, an allogeneic cardiac-derived cell therapy designed to treat Duchenne muscular dystrophy (DMD). Capricor states that this therapy aims to reduce inflammation and muscle degeneration while promoting muscle regeneration. Given that there is currently no cure for DMD, these trial results are highly anticipated.
U.S. Business News
As of October 4, the death toll from Hurricane Helene has risen to over 220, making it the second deadliest U.S. hurricane in 50 years. Cities like Asheville, N.C. remain isolated without power and phone service, with supplies being airlifted to cut-off communities. AccuWeather has estimated a total economic loss of $250 billion across affected states, including Florida, North Carolina, Tennessee, Georgia, and Virginia.
OpenAI, the parent company of ChatGPT, closed a $6.6 billion venture funding round, bringing its valuation to $157 billion, making it worth more than Uber. The company is projected to generate $3.7 billion in revenue this year. Some of the investors include Thrive Capital, Microsoft, Nvidia, and Softbank.
Tesla reported 463,000 Q3 deliveries, narrowly missing its target by just 300 vehicles. The stock dipped 2.83% this week following the news. Tesla will present plans about its Robotaxi to investors on Oct. 10.
Spirit Airlines is reportedly on the verge of filing for bankruptcy, as it struggles with over $3.3 billion in debt. While no official filing has taken place, Spirit had conversations with bondholders and creditors about the possibility. Back in January, the DOJ blocked the merger that was set to take place between Spirit and JetBlue.
Meta’s Ray-Ban smart glasses have raised major privacy concerns. Two Harvard students have discovered they can reportedly use facial recognition technology to pull personal data from the internet, including home addresses, relatives, and social media profiles. Meta’s terms and conditions warn against using the glasses in this manner, but the potential misuse has sparked debate.
Nike reported earnings Oct. 1. Nike reported a 10% drop in sales, down to $11.59 billion in Q3. Sales of Nike and Jordan sneakers were hit hardest, falling by 21%. The company has now reported six consecutive quarters of weak revenue growth, with lack of innovation cited as a major factor behind the downturn.
Southern universities are experiencing a 30% enrollment increase from 2018 to 2022, with more students from northern states choosing schools in the South, boosting the entry level job market in these areas. Notable universities seeing increased enrollment are Georgia Tech, Alabama, Tennessee, Ole Miss, South Carolina. The cost of tuition for public colleges and universities in the south is significantly cheaper. Payroll provider ADP conducted a new study that said the top five most promising locations to find work for new grads are all in the South
California has banned legacy admissions to private colleges, including Stanford and USC, in response to growing criticism over admissions favoring donor-connected students. This follows similar bans in states like Illinois and Colorado and comes after the Supreme Court's decision last year prohibiting race-based admissions policies.
Overseas Update
After China implemented a massive economic stimulus last week, questions are emerging as to whether it will be enough to boost consumer spending. In China, an estimated 65–80 million homes remain empty, reflecting the country’s housing market crisis. Consumer spending is lacking, with the price index growing just 0.3% over the past year, raising concerns about deflation. President Xi Jinping’s recent stimulus package focuses on lowering lending rates and boosting the stock market, but it fails to address the underlying issue of weak consumer spending.
In the Middle East, Iran’s launch of 180 ballistic missiles sent crude oil prices up more than 5%, with fears that oil production in the region could be disrupted. The region accounts for one-third of global oil production. In response, gold and bond prices rose, and stocks traded lower as Q4 began. Wall Street’s fear gauge, the VIX, jumped 24%.
Sports Update
MLB
The MLB Division Series begins Saturday, Oct. 5 and features a best-of-five format.
NLDS: Dodgers vs. Padres, Mets vs. Phillies
ALDS: Yankees vs. Royals, Tigers vs. Guardians
NFL
Thursday Night Football: The Atlanta Falcons secured a 36-30 overtime win against the Tampa Bay Buccaneers.
Sunday Night Football: The Pittsburg Steelers host the Dallas Cowboys
Monday Night Football: The Kansas City Chiefs face off against the New Orleans Saints.
NCAA Football
SEC: No. 9 Missouri vs. No. 25 Texas A&M
Big-10: No. 3 Ohio State vs. Iowa
ACC: No. 8 Miami vs. Cal
Big-12: No. 16 Iowa State vs. Baylor
Stay with us for more insights next week.
Disclaimer: This is not financial advice or a recommendation for any investment. The content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.
Ashlyn Haringa