October jobs report to arrive days ahead of Election Day, Fed's rate cut decision

Published On Oct 31, 2024, 6:00 AM

The October jobs report, set to be released before Election Day, is expected to show slower job growth, with an estimated addition of 115,000 jobs compared to 254,000 in September. This slowdown is influenced by factors such as recent hurricanes impacting various sectors and ongoing strikes in the aerospace industry, which could contribute to net job losses in manufacturing. The Federal Reserve is also expected to cut interest rates by 25 basis points next week, promoting a mixed outlook for the economy as inflation appears to be under control despite fluctuations in job growth and economic output.

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Stock Forecasts

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Positive

The labor market's slowdown along with the anticipated Fed interest rate cut may create volatility in financial markets. Companies that rely heavily on consumer spending, particularly in retail and hospitality, could face challenges due to forecasted weaker job growth. Conversely, rate cuts could bolster economic activity in sectors that benefit from lower borrowing costs.

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Negative

The aerospace and manufacturing sectors are likely to experience a negative impact from strikes and reduced job growth in the upcoming jobs report, affecting stocks in these industries. Companies like Boeing are directly related to this trend, which may struggle in the short term.

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