Some positive news in the markets this week, as equity markets rallied in response to the ceasefire announcement. And while Iran and oil prices have dominated the news cycle the past few weeks, they are not the only things moving the markets. Gary also analyzes the latest jobs report, hiring data, and expectations for the Fed. Watch the full video below:

TRANSCRIPT:

Hello, everyone. Welcome to this edition of 7 Market Movers. My name is Gary Quinzel with Wealth Enhancement. Once again, there’s been no shortage of market moving events that have impacted the markets these last few days.

Looking back to last Friday’s jobs report, we had a really strong number coming out of the US payrolls, well past expectations. We saw 178,000 jobs were created, which also saw the unemployment rate dip a little bit lower to 4.3%, which actually sent yields a little bit higher right out of the gate. It was definitely stronger than expected, but if you recall, the previous month’s payrolls report was much softer than expected. So we’re certainly seeing a little bit of back and forth there when it comes to the labor data.

I think one really interesting takeaway, if we dissect the underlying data, is that the hiring rate in the US is actually at its lowest rate since April of 2020 in the height of the COVID shutdowns. When the economy was basically shut down, we’re hiring the same number of people now that we were then, which is really interesting because right now what we’re experiencing is companies are not necessarily hiring, but they’re not laying people off either. So that’s something we’re definitely gonna be paying attention to as will the Fed. But, of course, right now inflation continues to be top of mind, and, of course, a lot of that, in fact, most of that has been driven by what’s going on in the Middle East and particularly in the Strait of Hormuz, where we, of course, had a ceasefire between the US and Iran, and that has significantly impacted the markets as of late.

So I noted that yields immediately went higher after the the jobs report. We’ve actually seen yields come significantly lower, ever since the ceasefire, on April 7th, and we’ve seen equity markets considerably rally, based on that positive news that we could see a prolonged, ceasefire, in the conflict that’s going on, and hopefully, a reopening of the Strait of Hormuz and that we could start seeing oil and and natural gas start shipping and flowing through that channel, hopefully, in the immediate future. However, the situation remains tenuous at best as we all know.

We are certainly not out of the woods yet, and traders are certainly very skeptical at this point as far as how long this ceasefire might actually last. And so we have seen volatility come down. As I mentioned, we saw equity markets significantly rally anywhere from 2% to 5% percent. If we take a look at the S&P 500, we’re actually almost flat on the year.

And, actually, if you look at the last 7 days in a row, it’s actually the longest winning streak for US equities going all the way back to October of last year. But that was definitely the turning point, you know, is if we have the safe passage of ships, that will remove the single biggest threat risk that’s hanging over global markets. And, certainly, all eyes are gonna continue to to focus on whether or not we can see that ceasefire amount to a longer shutdown, or I should say, an ending of the conflict that began at the end of February. So we’ll certainly be paying attention to that.

And the Fed, if you take a look at the Fed futures market and expectations for Fed rate cuts, which, of course, drive the markets, those those expectations have shifted from if we go back, you know, several weeks or several months, we went from having three rate hikes caked into our expectations. We actually had, at one point, expectations for a possible rate hike a few weeks back, and now we’re back to flat and maybe even one cut later this year. And so the market’s definitely in a little bit of a wait and see mode, but it’s again, it’s there’s never been a time that’s been so singly driven by one factor that, of course, is the price of oil, which has really been very, very volatile.

In fact, if you took it look at WTI and Brent, they plunged anywhere from 13% to 70% in a single session, after the ceasefire announcement was made. Brent falling all the way below $100 per barrel, and it’s bounced around a little bit since then. But we’re gonna continue to watch this, and the net tension has now shifted to inflation data that’s been coming in. On Thursday, we saw a PCE, which is personal consumptions, data come in, and it came in right as expected.

If we take a look at the headline number, it came in at 2.8%. The, the core number, which excludes food and energy, was at three percent. Both of those perfectly in line with expectations. That, of course, is the Fed’s preferred measure.

That’s the one that they’re looking at. It is a little more backward looking, but the Fed cares about that because it reflects what people are actually spending in terms of inflation. Now the CPI index, is slightly different, it’s more what things cost, not what people spend, that’s coming out on Friday. And so the expectations there are for 3.4% headline CPI inflation and 2.7% core.

And, of course, we will be focusing very much on that because that is the other mandate that the Fed cares about. And if we do start to see evidence that, the prolonged duration of higher oil is gonna start impacting the inflation data, that, of course, will impact future rate cuts. And so, we continue to be very, very focused on the situation, which is so fluid and constantly changing. But, fortunately, we can say that there has been some hope.

And if you look across risky assets, whether you’re looking at lower quality bonds or things like Bitcoin or or even safe haven assets like gold or the dollar itself, all those tend to be moving in line and are very, very closely tied to oil, which all hopefully optimistically, if we continue to cease fire, we’ll have some better news ahead, and we’ll continue to see this rally. But, you know, from a longer term perspective, we we we saw a little bit of a pullback in the markets. As I mentioned, we’re relatively back to flat right now, give or take. Valuations are are modestly more attractive than they were a few weeks back, and if you take a look at earnings expectations, they they continue to be relatively strong.

We’re still looking for roughly 2% to 3% earnings growth in Q1 and roughly 14% to 16% earnings growth for the year of 2026. And so we’ll continue to report on that. But for now, hope is is the the the keyword and fluidity, of course, because the situation is constantly changing, but we’ll continue to fill you in as the situation develops. But we’ll hope this rally continues, and I, we hope you appreciate it and and enjoy this market update, and tune in, for next week’s 7 Market Movers.

Take care. Have a great day.

This information is not intended as a recommendation. The opinions are subject to change at any time and no forecasts can be guaranteed. Investment decisions should always be made based on an investor’s specific circumstances. Investing involves risk, including possible loss of principal.

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