John Hancock: Weekly Market Recap Week Ended November 5th

Fed taper

As expected, the Federal Reserve said that it will soon begin to trim the $120 billion in bond purchases that it’s been making each month to support economic growth. The Fed continued to characterize the recent spike in inflation as “transitory,” but acknowledged that price increases have been faster and more enduring than they had forecast.

Jobs comeback

U.S. jobs growth in October exceeded most economists’ expectations, and the addition of 531,000 jobs signaled a resurgence in the labor market following recent weakness. In addition, the government adjusted initial jobs growth estimates for August and September upward by a total of 235,000, and the unemployment rate fell to 4.6% from 4.8%. 

Earnings surprises

With the earnings season now nearly completed, the proportion of S&P 500 companies that had beaten analysts’ net income expectations stood at 81% as of Friday, according to FactSet. That so-called beat rate ranks above the 76% five-year average. 

Price check

A government report scheduled to be released on Wednesday will show whether the recent spike in U.S. consumer prices carried over into October. The Consumer Price Index released last month showed that prices surged 5.4% for the 12-month period that ended in September—in line with the elevated levels seen over the summer amid rising energy costs and disruptions in global supply chains. 

Source: https://wmr.jhinvestments.com/