What we covered here
• The latest snapshot of the US labor market showed an unexpected rebound of 119,000 jobs in September but a loss for August and a lower total for July. The report was originally scheduled for October 3 but released today after a seven-week delay due to the government shutdown.
• It comes as earnings reports from some of America’s major companies flash warning signs about the US economy, with consumers and businesses becoming more cautious about their spending.
• The September report has taken on increased significance since it will be the only snapshot of the labor market that the Federal Reserve will have in hand to assess the state of the economy when policymakers meet on December 9-10.
• Today’s data was expected to show that the unemployment rate held at 4.3% and that around 50,000 jobs were added, a far cry from last September, when the US economy added 240,000 jobs.
Stocks and bitcoin tumble as AI bubble concerns resurface
Nvidia’s stellar earnings on Wednesday offered a boost of confidence for investors — but the relief was short-lived.
After a strong morning rally, stocks took a dive midday Thursday. Tech and AI stocks led the market lower. Nerves about expensive valuations and big tech companies’ enormous spending plans are contributing to a persistent risk-off sentiment.
The Dow fell 387 points, or 0.84%, reversing course after climbing 718 points earlier. The S&P 500 fell 1.56%, erasing a gain of 1.93% earlier.
After soaring as much as 2.58% after the opening bell, the tech-heavy Nasdaq Composite turned into the red and fell 2.15%.
Nvidia shares (NVDA) closed lower by 2.97% after rising as much as 5% earlier, dragging down the broader market.
While stocks turned lower, bitcoin continued its recent slide, dipping below $86,500.
“This is a market that’s cautious,” said Jed Ellerbroek, portfolio manager at Argent Capital Management. “And an awesome Nvidia earnings print and optimistic talk from their CEO wasn’t able to turn the tide. And if he can’t, then who can? Nobody — in the short term, at least.”
“I don’t think that this is the popping of an AI bubble right now,” Ellerbroek said. “I think this is some healthy skepticism after a six-month period of exuberance.”
The calendar matters too, Ellerbroek said. Investors might be taking profits after a year of strong gains, especially as nerves mount about whether the Federal Reserve will cut interest rates in December.
Wall Street’s fear gauge, the VIX, jumped 13%. CNN’s Fear and Greed Index hovered in “extreme fear” and hit its lowest level since early April.
AI stocks and bitcoin slide as volatility picks up
Stocks fell in afternoon trading as volatility crept back onto Wall Street.
The Dow was down 232 points, or 0.5%. The S&P 500 fell 1%. The tech-heavy Nasdaq slid 1.5%.
Wall Street’s fear gauge, the VIX, jumped 16% — a swift change after having fallen as much as 17% earlier.
Nvidia shares (NVDA) were down 2.5%, weighing on the broader market. The chipmaker on Wednesday reported better-than-expected earnings, and the company’s stock gained as much as 5% early Thursday before turning into the red.
Investors could be taking profits after strong gains. Nerves are also lingering about expensive tech stocks. Risky assets like AI stocks and cryptocurrencies were hit hard, with Palantir shares (PLTR) sliding 5% and bitcoin slipping below $86,500.
The S&P 500 earlier climbed above its 50-day moving average, a key threshold for Wall Street traders. That 50-day moving average was a test, and stocks tumbled as traders failed to rally and hold the index above that point of resistance, according to Jay Hatfield, chief executive at Infrastructure Capital Advisors.
Meanwhile, bonds rallied as investors sought out safe havens. Treasury yields fell as investors scooped up bonds.
The federal government shed more jobs in September
Over the course of the past 80 years, employment has held largely consistent in the federal government (with little spikes every 10 years when the Census rolls around). Federal jobs account for a tiny share (1.8%) of the US labor force.
However, that long-stable industry was thrown into upheaval earlier this year when the Trump administration, via its Department of Government Efficiency effort, sought to drastically reduce the federal workforce by an estimated 300,000 workers, gut programs and slash funding.
The ongoing paring down of the federal workforce was evident in Thursday’s jobs report.
In September, federal employment declined for the eighth consecutive month, dipping by an estimated 3,000 jobs. Since January, that sector has shed about 3% of its jobs and is now hovering around 2.9 million workers, BLS data shows.
Those layoffs were expected to surge higher in October (due to the scores of workers who accepted buyouts with a final date of employment on September 30). However, that October jobs data is expected to heavily muddled due to the federal government shutdown.
Still, September did see a 22,000-job net gain in the “government” due to the longstanding drivers of public sector employment gains: state and local governments (at places such as schools, hospitals, utilities, law enforcement agencies).
State government employers (5.5 million workforce) added an estimated 16,000 jobs in September, while local governments (15.2 million workforce) added an estimated 9,000 jobs.
White House says all jobs went to American-born workers. It's not that simple
The White House on Thursday touted the September jobs report as “great progress” for the US economy, highlighting gains in the private sector.
“Almost all of these new jobs were in the private sector and went to American-born workers instead of illegal aliens,” White House press secretary Karoline Leavitt wrote in a statement.
But, due to the structure of the jobs report, it is not possible to attribute employment gains to any particular demographic or the documentation status of workers.
While the foreign-born labor force has declined somewhat after peaking earlier this year, economists say the drop-off can be attributed to fear of answering surveys or indicating their nativity status.
Additionally, Trump administration officials have frequently made a related misleading statement, claiming that “more than 2.5 million native-born workers gained employment, while 670,000 foreign-born workers lost employment.”
However, the White House is relying on datasets – employment levels for native-born and foreign-born workers – that are not designed for those estimations, economists such as Jed Kolko have noted.
The estimated nativity numbers are drawn entirely from responses to a survey with a small sample size. Additionally, the broader employment levels are adjusted annually to align with Census population estimates; as such, the resulting numbers have to add up to the predetermined population controls, he noted in an August post on the topic.
“If foreign-born responses drop for whatever reason – such as immigrants becoming less comfortable sharing data with the government – then the sampling and weighting procedures in the survey will adjust the native-born population as well so that the total population equals the population controls,” he wrote.
Stock market rally loses steam
After a strong morning, the rally on Wall Street reversed course midday as nerves persist about expensive tech stocks and the potential for the Federal Reserve to hold interest rates steady at its policy meeting in December.
The Dow, S&P 500 and Nasdaq each turned into the red.
The Dow fell 162 points, or 0.37%, after climbing more than 700 points earlier.
The S&P 500 fell 0.5%, erasing earlier gains. The tech-heavy Nasdaq fell 0.66% after climbing as much as 2.58% earlier.
“Stocks are now deep in the red in colossal U-turn fashion,” said José Torres, senior economist at Interactive Brokers.
Nvidia (NVDA), which had helped lift the market higher, turned into the red and fell 1.2% after gaining as much as 5% earlier. The slide in Nvidia’s stock weighed on the broader market.
Meanwhile, investors wrestled with the possibility that the Fed will hold rates steady at its policy meeting in December, sapping some energy out of the market rally.
Meanwhile, bitcoin slid more than 2.6% and fell below $87,000, extending a recent tumble.
Mortgage rates tick up for a third-straight week
Mortgage rates have been edging higher as uncertainty grows over whether the Federal Reserve will cut rates in December. The latest jobs report has added to the confusion over when borrowing costs will be lowered.
The average 30-year fixed mortgage rose to 6.26% for the week ending November 20, according to Freddie Mac – up from this year’s low of 6.17%, reached just three weeks ago.
While the Fed doesn’t directly set mortgage rates, its decisions can affect the US 10-year Treasury yield, which mortgage rates track.
Kara Ng, a senior economist at Zillow Home Loans, said that with the federal government reopened, mortgage rates might be especially reactive to incoming economic data that had largely been on hold last month.
“The modest rate relief seen in September and October encouraged both buyers and sellers to re-engage, leading to stronger-than-expected housing activity for the season,” Ng said.
White House touts wage gains — but there's a big caveat
In a statement released after Thursday’s job report for September, White House press secretary Karoline Leavitt highlighted that wages for American workers rose.
While it’s true that average hourly earnings were up 3.8% in September compared to the prior year and 0.2% compared to the prior month, that doesn’t take into account the added costs Americans are facing that are captured in inflation data.
For instance, in August, despite the 3.7% annual increase in average hourly earnings, when taking into account inflation, wages were up just 0.8%, the Bureau of Labor Statistics reported.
The agency is set to release inflation-adjusted wage data for September on Friday.
US home sales climbed in October to an eight-month high
Sales of previously owned homes rose last month, in a sign that lower mortgage rates are luring buyers off the sidelines.
Existing home sales, which make up the vast majority of the market, climbed 1.2% in October from the prior month to a seasonally adjusted annual rate of 4.1 million, the National Association of Realtors said Thursday, the highest level since February. It’s also the second consecutive month of rising home sales.
Mortgage rates have declined in recent months in anticipation of the Federal Reserve lowering interest rates in September and October. The average rate on a 30-year fixed mortgage reached the lowest level of 2025 in late October, and has edged higher since, according to Freddie Mac.
However, some regional markets fared better than others.
Yun also pointed out that “rents are decelerating, which will reduce inflation and encourage the Federal Reserve to continue cutting rates.”
Concerns about stagflation are mounting. Here's what the term means
More questions are lingering about whether the economy is experiencing stagflation after the September jobs report was released.
Stagflation refers to a scenario where economic growth is slowing substantially, which typically occurs with rising unemployment, while inflation accelerates.
Though there’s no official threshold for what determines whether an economy is experiencing stagflation, current conditions aren’t close to where they were during the 1970s and 1980s, when inflation and the unemployment rate hit double-digit levels. At the same time, the latest employment figures aren’t doing much to calm fears about stagflation.
In September the unemployment rate rose to 4.4% from 4.3% in August, the Bureau of Labor Statistics reported on Thursday. (The September jobs report was supposed to be released last month but was delayed due to the government shutdown.) Additionally, new revised data for August that the BLS reported Thursday indicates the economy shed 4,000 jobs.
Meanwhile, the annual rate of inflation rose to 3% in September from 2.9% the month prior, according to Consumer Price Index data.
Here's what Wall Street is saying about the long-delayed jobs report
US stocks surged higher Thursday as Nvidia’s strong earnings helped investors breathe a sigh of relief that the outlook for the AI boom remains intact.
The Dow gained 685 points, or 1.45%. The S&P 500 rose 1.8%. The tech-heavy Nasdaq Composite gained 2.3%.
Wall Street also picked apart the September jobs report. Here’s what investors, strategists and economists are saying:
- “The one-two punch of a stellar Nvidia earnings report last night and a better-than-expected September jobs report this morning should give the market a boost, given that it directly addresses the two biggest concerns of the bears: an AI bubble and a moribund economy.” — Chris Zaccarelli, chief investment officer at Northlight Asset Management.
- “On balance, a little better than expected, reassuring those Fed officials worried about the downside risks to the labor market. We now expect the Fed to delay its next rate cut until January.” — Paul Ashworth, chief North America economist at Capital Economics.
- “Without any further jobs reports ahead of the December [Fed] meeting, today’s jobs release is unlikely to tip the balance to a December cut.” — Seema Shah, chief global strategist at Principal Asset Management.
- “Although the September numbers were stronger than expected, the overall state of the US labor market remains weak.” — Eugenio J. Alemán, chief economist at Raymond James.
- “This report — stale, noisy, prone to revision — was never going to provide a high quality steer as to cut or skip in December, but a clear upside or downside surprise across the report as a whole might well have served as a tie-breaker for a deeply divided Fed. We did not get the tie-breaker.” — Krishna Guha, vice chairman at Evercore ISI.
A closer look at where the job gains came from
The health care and social assistance sector continued to drive overall employment growth in September, adding an estimated 57,100 jobs or nearly half of the overall gains. Leisure and hospitality contributed 47,000 jobs during a month with unseasonably warm weather.
Number of people receiving unemployment benefits hit four-year high
In addition to the September jobs report, the Department of Labor released new figures for the week ending November 1 showing that the number of people receiving unemployment benefits hit a four-year high.
In total, 1.8 million people were receiving unemployment benefits that week, an 18,000 increase from the prior week. Meanwhile, the number of initial jobless claims for the week ending on November 15 fell by 8,000 to 220,000.
Dow soars 600 points as Wall Street cheers Nvidia earnings
US stocks opened higher Thursday as investors embraced enthusiasm about AI and digested the September jobs report.
The Dow rose 626 points, or 1.36%. The S&P 500 gained 1.65%. The tech-heavy Nasdaq Composite rose 2.1%.
Wall Street’s fear gauge, the VIX, fell 17% as investors leaned into optimism about AI. Nvidia shares (NVDA) gained 3.7%.
The US economy added 119,000 jobs in September, although the unemployment rate ticked up to 4.4%. The better-than-expected job gains could boost arguments for the Fed to hold rates steady at its December meeting — but the higher unemployment rate complicates the picture.
Two-year Treasury yields, which can track expectations for the Fed’s benchmark interest rate, were relatively unchanged but ticked slightly lower.
“Equities (stocks) like the fact that payrolls were stronger than expected, suggesting the economy is still on a firm footing, while the bond market likes the rise in unemployment and slowdown in wage growth which may keep the case for a December Fed cut just about alive,” Seema Shah, chief global strategist at Principal Asset Management, said in an email.
Optimism about an AI boom, resilient corporate profits and hopes for lower interest rates helped stocks climb higher in recent months before a dip in recent weeks.
Wall Street is feeling better about the prospects of AI after Nvidia’s stellar earnings. Now the Fed’s interest rate policy could become more of a key focus for determining whether stocks can rebound from this recent pullback or if there’s more turbulence ahead. The S&P 500 is down 2.5% from a record high set in late October.
Revisions to monthly job numbers paint an even worse picture of US economy
The long-awaited September jobs report showed revisions to previous months’ data: The Bureau of Labor Statistics reported that there were 26,000 fewer jobs added in August than the initially reported 22,000 job gains. The revised data means the economy instead shed 4,000 jobs that month.
For the month of July, the BLS also revised down the number of people hired by 7,000, bringing the total job gains for that month to 72,000.
The number of people hired each month is subject to several revisions; the first two occur in the next two months’ job reports as the government gets more data.
December rate cut still far from a slam dunk
Investors now see a slightly greater chance that the Federal Reserve will lower interest rates again next month, after the government’s latest jobs report showed that unemployment climbed in September.
But a December rate cut is still far from a slam dunk.
Unemployment climbed in September to 4.4%, the highest level since October 2021. Unemployment generally carries more weight than job growth in the Fed’s assessment of the labor market.
Investors see a roughly 36% chance of a December rate cut, according to the CME FedWatch Tool, up slightly from 33% yesterday. The chances of the Fed holding rates steady is currently around 64%.
Fed officials are divided on how to proceed in December, with several expressing concerns about persistently elevated inflation in recent public comments and during the Fed’s October meeting, when it lowered rates for the second time this year, according to minutes from that meeting released Wednesday.
Layoff announcements are surging. Here are some of the largest cuts
Corporate America is increasingly reckoning with economic headwinds and, as a result, there’s been a surge in layoff announcements.
Last month alone, Challenger, Gray & Christmas, a staffing agency that tracks employment trends, reported that companies announced 153,000 cuts, a 175% increase from October 2024.
Advancements in AI as well as higher costs stemming from tariffs are behind many of the cuts.
Here are some of the largest recent corporate cuts:
Verizon is laying off 13,000 employees
Verizon is cutting 13,000 positions — the wireless and internet company’s largest single layoff ever — marking the first initiative in the new CEO’s transformation plan.
Dan Schulman, who became Verizon’s CEO last month, said in a letter to employees Thursday that the company was overspending on staff and underinvesting on enhancing the customer experience. He said he’s making changes to “address the complexity and friction that slow us down and frustrate our customers.”
The layoffs will be extend across its entire business, he said, and Verizon will also “significantly reduce” its outsourced labor expenses. The company is establishing a $20 million fund for affected employees to focus on the “opportunities and necessary skill sets” for AI.
“The actions we’re taking are designed to make us faster and more focused, positioning our company to deliver for our customers while continuing to capture new growth opportunities,” he said.
Verizon’s sluggish customer additions has led to its stock losing a third of its value over the past five years.
Competition has also increased from T-Mobile and AT&T with the carriers battling for cost-conscious consumers with tempting deals and trade-in offers. Schulman, a former PayPal CEO, said Verizon needs to be more “scrappy” to compete against them.
Verizon has about 100,000 employees. A spokesperson said the layoffs are an “opportunity for Verizon to reset, restructure and realign our priorities in ways that will help us regain our leadership as a communications provider.”
Delayed employment report shows the US economy added 119,000 jobs in September
The US economy added 119,000 jobs in September, according to data released Thursday after a seven-week delay due to the government shutdown.
That’s a huge rebound from August, when 4,000 jobs were lost, according to new data from the Bureau of Labor Statistics. The September unemployment rate moved up to 4.4% from 4.3%.
Economists were expecting 50,000 jobs to have been added and an unemployment rate that remained at 4.3%, according to FactSet.
Although the September employment data has been on the shelf since early October, it provides a critical snapshot of the labor market at a time when tariffs, stubborn inflation and elevated interest rates continue to slow the US economy.
Why it's still a "low-hire, low-fire" job market
Still-elevated interest rates, stubborn inflation and uncertainty about tariffs have made companies hesitant to hire. But they’re also reluctant to lay off their current workers.
For those without work, that equates to more time searching for a new position. The average job hunt now lasts more than six months, according to data from the Bureau of Labor Statistics. It’s the slowest hiring cycle in more than a decade.
The labor force increased by 436,000 people in August, according to BLS data. The labor force participation rate moved higher as well, ticking up to 62.3% from 62.2%.
While the majority of those labor force gains were from people classified as employed, the increase in those unemployed was largely attributed to people re-entering the labor market to search for work.
