Markets on edge as jobs silence, earnings surge and Fed outlook collide

Investors are staring down a triple threat this week as corporate results, a missing jobs report, and the Fed’s messy rate fight all crash into each other with just eight weeks left in 2025. Nobody’s resting. Everybody’s watching.

Amazon’s blowout earnings Thursday night pushed the Nasdaq to a 2.5% gain last week. The S&P 500 and Dow followed with 1% climbs.

But the party’s already over. Earnings from Palantir, AMD, Supermicro, Constellation Energy, and dozens of S&P 500 companies are dropping this week, and Wall Street is bracing for all of it without a full set of economic data.

Thanks to the government shutdown, the official monthly jobs report is missing again. That hands the spotlight to ADP’s private payrolls data, due Wednesday.

Also on the calendar: updates on manufacturing and services activity from ISM and S&P Global, and consumer sentiment numbers from the University of Michigan on Friday.

Fed chair Powell tells markets December cut is not guaranteed

The Fed cut interest rates last week, just like markets expected. But Jay Powell used his post-meeting press conference to rip the rug out from under traders hoping for another cut in December.

“Not a foregone conclusion, far from it,” Powell said, tightening the screws on what had seemed like a sure thing.

Daniela Hathorn, analyst at Capital.com, said, “The FOMC wasn’t as dovish as markets had hoped last night when Jerome Powell poured cold water on those expecting another 25bps cut in December to be a done deal.”

Traders got the message. On Friday, markets were giving just a 63% chance of another quarter-point cut in December, down from 95% a week ago. Inside the Fed itself, the divide is growing.

Stephen Miran wanted a 50 basis point cut. Jeff Schmid, the Kansas City Fed president, wanted no cut at all. By Friday, three more regional Fed members echoed Schmid’s view.

BNP Paribas analysts said Powell “will likely have less control” going forward, with more regional voters “vocal in their disagreement.” Bank of America still sees no further cuts “under Chair Powell,” while BNP still expects one in December. Both banks agree the path forward looks chaotic.

Adding to the chaos is the fact that the Fed is working blind. The lack of data has turned policy-making into guesswork. Every report now matters more than ever, and this week has plenty of them.

Trump and Xi claim new deal, but markets aren’t buying it yet

On Thursday, President Donald Trump met Chinese President Xi Jinping in South Korea and told reporters on Air Force One: “Zero to 10, with 10 being the best, I’d say the meeting was a 12.” He announced what he called a deal, covering rare earth metals, soybeans, fentanyl, and port fees.

Washington promised to cut fentanyl-related tariffs on China from 57% to 47%. In return, Beijing will suspend rare earth export controls for at least a year.

China also agreed to buy 25 million tons of US soybeans every year for three years, a big win for American farmers who’ve been hit by years of canceled Chinese orders.

But nobody’s calling this settled. Bank of America said the agreement “reduces tail risks,” but Macquarie analysts said it “largely reestablishes the status quo from the early summer.”

They also noted “several items were left out,” including TikTok and Taiwan, two flashpoints that weren’t even mentioned during the talks.

This wouldn’t be the first time a Trump-Xi agreement fizzled. Back in 2020, they signed the Phase One deal, with China agreeing to buy $200 billion of American goods. They only bought just over half. The US kept most of its tariffs anyway, and things got worse from there; investment bans, WTO-authorized retaliation, and all.

The most glaring omission this time? Trump said Nvidia’s Blackwell chips weren’t even discussed. So nobody knows whether the company will be allowed to sell its top-tier AI chips to Chinese customers.

Now, it’s up to investors to figure out what sticks and what doesn’t. Like Macquarie said, the framework may look wide, but it’s not comprehensive. And while some tariffs are getting rolled back, others (and bigger geopolitical questions) are still untouched.

Bank of America reminded clients that November usually favors stocks, writing, “Buy Halloween or Christmas Eve as it tends to pay for a NYE celebration.”

But between Powell’s mixed signals, missing jobs data, and Trump’s dealmaking déjà vu, there’s too much noise for anyone to feel confident.

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