Soft concern will increase Fed rates. The Bureau of Labor Statistics reported 57K in new nonfarm payrolls in June, well below the forecast of 114K, and revised May’s number to 129K from 179K. There was a surprising weakness in entertainment and hospitality, which was expected to increase with the arrival of the World Cup.. A better number given the noise in the monthly numbers, at a 3-month average, is 111K in the BLS data. Pointing to a flexible job market.

Yesterday, Fed Chair Kevin Warsh said risks had eased, lowering rates to 19 percent from 31 percent in July. The expected jobs data for June makes the case that the Fed will do nothing for now, waiting to see if the energy shock from the Iran war is truly behind us.. On that front, oil has fallen to $67.50/bbl, the lowest since the first week of the Iran war. Today it is less than 3 percent. Today it is down 5bps to 4.12%. Down 2bps to 4.46%, and flat.

Stocks initially jumped on the news, but began to fade after the first half hour. Technology weakness continues. Tech as a whole is down 2.1% today, down 5.1% for the last month but still up 28.9% YTD. There are concerns that higher memory prices will lead to AI solutions that require less memory, and that building a data center will not be possible until everything is eventually ready.. And the token pricing of AI software will push consumers toward lower-cost versions, especially Chinese offerings, and is cautioning against enthusiasm for all things AI.

I don’t want investors to worry about the selloff in AI and data center-related stocks.. In my opinion, the big news is that the order backlogs of AI and data center-related companies have grown to a backlog of about 3 years, so the data center boom is expected to continue until at least 2029.

We usually have a reverse day.. is just 1.7% from its all-time high, and earnings season is approaching, which should be all the stronger in 1Q26, with mid-20% annualized earnings. The trend remains positive.