S&P 500 is in the green this morning even though the Bureau of Labour Statistics reported a better-than-expected growth in nonfarm payrolls for December.
Notable figures in the monthly jobs report
Nonfarm payrolls went up by 223,000 last month – a slight decline from 256,000 in November but meaningfully more than 200,000 that economists had forecast.
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Continued strength of the labour market suggests the Fed still has more to do in its ongoing fight against inflation. According to Leon Cooperman – the billionaire chairman of Omega Advisors:
Labour seems to have the upper hand. There’s 1.7 jobs available for everyone looking for a job. That’ll be difficult for profit margins. So, going into a new bull market anytime soon makes no sense to me.
Versus its record high, the benchmark index is currently down roughly 20%.
Cooperman sees downside risk to low 3,000s
Also on Friday, unemployment rate was reported to have declined to 3.5% – 20 basis points below expectations.
Average hourly earnings in December gained 0.3% versus the prior month and 4.6% on a year-over-year basis. Economist had called for 0.4% and 5.0%, respectively. Speaking with CNBC’s Scott Wapner, Cooperman added:
I have low expectations from the market. In 2023, I’d say 50% chance that we stay in the range of 3,600 to 4,400. 5.0% change only of going above the 4,400 level. And a 45% chance that we could go into the low 3,000s.
A day earlier, a Piper Sandler analyst also said the S&P 500 could sink another 16% from here as the Fed pursues its signalled terminal rate of 5.1% as Invezz reported here.
Source: https://invezz.com/news/2023/01/06/us-monthly-jobs-report-leon-cooperman-market-outlook/