After weeks of data gaps from the fall federal shutdown, traders finally got a noisy read on labor conditions. Markets focused on two cross-currents. Payrolls swung from a drop to a rebound, while unemployment rose to a new cycle high. The result was a risk-off tilt that stopped short of panic.
According to Tuesday’s close, the S&P 500 slipped 0.24% to 6,800.26 and the Dow fell 302 points to 48,114.26, while the Nasdaq edged up 0.23% to 23,111.46. Energy was a standout laggard as crude extended its slide and dragged major producers lower, including Exxon and Chevron, which were down about 2% each.
The immediate catalyst was the delayed jobs report. It showed +64,000 payrolls in November after -105,000 in October, with the jobless rate rising to 4.6%. Investors treated the print as directionally weaker but statistically messy. Fed pricing barely budged. CME FedWatch odds held around 24% for a January cut, signaling the market wants confirmation before repricing the path.
What happens next likely hinges on whether “soft growth” morphs into an earnings downgrade cycle. For now, rotation is doing the work. The tape is rewarding defensives and rate-sensitive quality while punishing crowded themes and cyclicals tied to global demand.
Position around clarity, not the noise. With labor data distorted, the next clean inflation and jobs prints will matter more than today’s headline swing.
