In today's video, we break down what we can expect from the market's response to the jobs data. Are we heading into a recession? Jobs data came in lower, which suggests we may be getting cuts; however, there is more data to be released later on this afternoon.
In cryptocurrency, we have seen a flurry of sales hitting Coinbase Prime deposit in what appears to be investors removing risk from Bitcoin. Video by Traders Reality.
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On January 7, 2026, the market's response to the latest jobs data has been relatively muted and sluggish. Investors are interpreting the latest private payroll figures as a sign that the labor market is "cooling but not cracking"
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Key Market Reactions (January 7, 2026)
-Equities: U.S. equity futures remained flat to sluggish today. This follows a record-setting session yesterday where the Dow and S&P 500 closed at all-time highs.
-Investor Sentiment: There is a "standby mode" in global markets as traders wait for Friday’s more comprehensive official non-farm payrolls report.
-Currency: The U.S. Dollar has steadied as markets weigh the timing of Federal Reserve interest rate cuts.
Summary of Recent Data
-ADP Private Payrolls: Released this morning, data showed U.S. businesses added 41,000 jobs in December. While this was slightly weaker than some expected, it suggested a mild improvement from deeper weakness seen earlier in the year.
-Unemployment Context: The broader unemployment rate has been trending higher, reaching 4.6% in November, its highest level in four years.
-The "No Hiring, No Firing" Narrative: Markets are currently characterized by a trend where hiring momentum has slowed, but mass layoffs are not yet occurring.
Impact on Federal Reserve Expectations
-Rate Cut Odds: The recent cooling of the labor market has led some investors to price in a 50/50 probability of a rate cut in March 2026, with a full cut not fully priced in until June.
-Fed Policy Stance: Because wage pressures remain firm and job growth is still positive (though slow), policymakers have little immediate pressure to deliver rapid or front-loaded rate cuts
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