r/stocks
Market Diving due to a *strong* labor market
Author finds irony in market drop triggered by strong labor data, remains long-term bullish despite short-term rate fears.
- Strong labor market indicates underlying economic resilience and health.
- Short-term market volatility is viewed as noise rather than a fundamental trend change.
- Long-term investment horizon mitigates the impact of temporary macroeconomic shocks.
- Strong labor data may delay interest rate cuts or lead to hikes, pressuring valuations.
- Market reaction suggests investors are prioritizing immediate monetary policy risks over economic strength.
- Potential political volatility regarding Fed policy could introduce additional uncertainty.
I’m not freaking out from yesterday’s dive. Stocks are a long game, short term variances are just noise.
With that perspective, yesterday’s market becomes kind of amusing. Obviously, there was more going on than just this, but isn’t it kind of funny that the dive was caused by a surprisingly \strong\ labor market? “Oh shit guys, the economy is better than we thought. Sell!”
Obviously this makes senses given its impact on interest rates. But still, kind of funny.
Side note: stock up on popcorn if the labor market stays strong. Imagine Trump’s socials if Wash ends up \~raising\~ rates
i’m thinking everyone is cooking their books. like how the hell did victoria’s secret have a blowout first quarter? i mean sure, k-shaped economy, but i don’t imagine the 1% have suddenly started going gangbusters on buying lacy bras
Ozempic is the reason. I remember seeing some galaxy brain post about going all in on Victoria's secret due to all the people on ozempic now having the confidence to wear sexy clothing. Seems like the thesis was true.
I work in an industry specifically geared towards sales to 500k and above earners. We're busy.
It's not the 1% it's the 10%.
The report said the 172,000 jobs “beat expectations” of 83,000. The issue is that those seem like some low expectations. Can you jump over this stick? No. Let me lay it in the ground. How about now?
the gop tore apart 300k job reports as not enough. some of the latter ones were revised down latter. but anyway I am supposed cheer a 172 with an expected of 80. i love the stick thing i am stealing that.
70k of those jobs were in hospitality, and something like 50k of those are temp. World Cup related positions.
Looking under the hood Most of the jobs created were in low paying hospitality and home healthcare. Also there was a strange bump in local government jobs that looked unsustainable. However the upward revisions to past months’ data combined with the May adds pretty much rules out any interest rate cuts this year. Long yields jumped and that triggered the stock sell off. This rally from the March lows was almost a straight line up and was due for a pull back. Definitely could get worse if long term bond yields keep climbing.
Local govts are hiring to offset the federal/non profit cuts. Services are needed and local govts can deliver.
Thats not true. Manufacturing has been getting more efficient since it began.
And if you look at data centers they might have less than a few dozen active employees.
As someone working at a bank in charge of consumer loan delinquency monitoring, your observations are correct. Since the beginning of 2025, we’ve seen 2x increases in losses and consumers are applying for loans with almost 3x outstanding credit card balances and existing delinquent accounts. It seems like it’s only a matter of time before the bottom falls out for the average consumer.
This sub is somehow less economically literate and less in tune with reality than almost any other.
0% rates means profits that occur ten years out can be accounted for today. Ie) $1b in earnings in 2036 = $1b earned in 2026.
Its terrible for the market and economy. The pandemic just misallocated resources. Imagine this AI wave but with zero interest rates. Stock prices would be way higher - until rates go up and they would tank like 2022
I don’t think you know how interest rates work….