Despite Strong Jobs Report, Stocks Declined Last Week

Published Friday, September 2, 2022 at: 7:48 PM EDT

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The economy created 315,000 new jobs in August, signaling a recession has not begun despite Federal Reserve tightening and its hawkish pronouncements about its determination to end the post-pandemic inflation cycle. To be clear, employers continued to create more new jobs than were lost in August, even as the Fed said its No. 1 priority is ending the worst inflation in four decades. Stocks lost ground anyway.

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Unemployment remains near an all-time low, but it ticked up in August to 3.7%. Unemployment rose even though the economy has been creating new jobs at a strong pace for months because the U.S. labor force — those 16 and older — returned to the labor force following The Great Resignation of the Covid 19 pandemic, when many individuals in their 60s left the labor force. 

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The labor force — the proportion of the civilian population 16 years of age and older either at work or actively seeking work — rose slightly in August. The return to the labor force of individuals in their 60s who decided to retire during the pandemic, is why the unemployment rate rose. While it’s too soon to say that this is a trend, growth in the labor force would be a positive development.

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The Standard & Poor’s 500 stock index closed this Friday at 3,924.26. The index lost -1.07% from Thursday and -3.3% from last week. The index is up +54.8% from the March 23, 2020, bear market low and down 20% from the January 3rd all-time high on a total return basis.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is a market-value weighted index with each stock's weight proportionate to its market value. Index returns do not include fees or expenses. Investing involves risk, including the loss of principal, and past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted.  


Nothing contained herein is to be considered a solicitation, research material, an investment recommendation, or advice of any kind, and it is subject to change without notice. Any investments or strategies referenced herein do not take into account the investment objectives, financial situation or particular needs of any specific person. Product suitability must be independently determined for each individual investor. Tax advice always depends on your particular personal situation and preferences. You should consult the appropriate financial professional regarding your specific circumstances. The material represents an assessment of financial, economic and tax law at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. Forward-looking statements are subject to certain risks and uncertainties. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete, and is not intended to be used as a primary basis for investment decisions. This article was written by a professional financial journalist for Advisor Products and is not intended as legal or investment advice.

This article was written by a veteran financial journalist based on data compiled and analyzed by independent economist, Fritz Meyer. While these are sources we believe to be reliable, the information is not intended to be used as financial advice without consulting a professional about your personal situation.

Indices are unmanaged and not available for direct investment. Investments with higher return potential carry greater risk for loss. Past performance is not an indicator of your future results.

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