Hot employment report leads stocks lower, at least for now 

Odds of an interest rate cut later this month are all but out the window

article-image

rblfmr/Shutterstock modified by Blockworks

share


This is a segment from the Forward Guidance newsletter. To read full editions, subscribe.


It’s US Employment Report Day! December’s figures came in much stronger than expected. 

Nonfarm payrolls grew by 256,000 and blew past analysts’ forecast of 155,000 — significantly higher than November’s 212,000 positions added. The unemployment rate edged down just slightly, coming in at 4.1% vs. the expected 4.2%. 

There is such a thing as a too hot report, though. 

“There is a growing worry on Wall Street that inflation is making a comeback. While a strong labor market is good for the US, there are worries that too strong of a jobs market will put reflation back on the table,” said Bret Kenwell, US investment analyst at eToro. 

The odds of an interest rate cut later this month are all but out the window, and chances central bankers opt to lower fed funds in March or even May aren’t looking great, either. 

US equities, after a decent start to the new year, are now solidly in the red for 2025 — likely an impact of diminished rate cut expectations and growing concern that the devastating fires in Los Angeles will come with significant financial consequences. 

Still, a resilient labor market and economic growth — which, according to the data, is where we currently stand — isn’t bad for stocks, according to Jessica Rabe, co-founder of DataTrek Research. 

The employment situation bodes well for corporate profitability.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 18 - 20, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

recent research

Research Report Templates.jpg

Research

The L2 ecosystem has evolved into a complex landscape, with over $17B in market value and $50B in secured assets. While traditionally seen as high-beta plays on Ethereum, no L2 token achieved a beta higher than 1.0 relative to ETH in 2024. Furthermore, token dilution significantly impacted the sector, with a 1% increase in circulating supply corresponding to a 1.4% decrease in returns.

article-image

The Calamos Bitcoin Structured Alt Protection ETF — January is set to offer “systematic risk management” across its roughly one-year outcome period

article-image

Crypto industry elites (and a journalist or two) donned black tie at the Crypto Ball Friday night

article-image

Solana sees new highs in SOL prices, DEX volumes and REV

article-image

President-elect Donald Trump launching his own coin may have sent crypto on an entirely new path

article-image

SOL is up 19% on the week leading up to Trump’s inauguration

article-image

With his inauguration days away, let’s review some of his vows regarding tariffs and SEC guidance