ADP Reports Slowing Job Growth in November

After a rough day yesterday, stock investors are back in the saddle this morning and ready to take another chance at making money.  This irrational behavior follows legitimate concerns over a potential stall in signing an agreement with China to help bring the trade war to an end. Often times after a sharp loss in the stock market we will see what is referred to as a “dead cat bounce.”  This is where stocks recover the follow day only to have it a failed short term attempt that ultimately falls flat. We’ll have to see how the next couple of days play out. But this is a possible scenario that I wouldn’t be surprised to see happen.

President Trump did come out this morning and confirmed that trade talks are progressing, again implying that we may soon see an end to the trade war. I don’t know about you, but I find this back and forth rhetoric exhausting.

This morning we received the ADP Job Report, showing that there were only 67,000 new hires in the month of November. This falls very short of the 150,000 the market was anticipating, and could set the stage for a disappointing number on Friday when the Bureau of Labor Statistics is set to make their announcement on job growth.

A deeper look at the ADP report shows that employers with 20 or fewer employees actually experienced job losses. Considering that small business is the backbone of America, this is a concerning report. If the BLS report confirms the same findings, that would help support lower mortgage interest rates.

We will maintain a locking bias.