Heard on the Street Recap: Answering to a Hire Power -- WSJ
By Heard Editors
Goldilocks has entered the building.
Lately, U.S. economic data has either been unequivocally bad or too strong to be good. Friday was different.
The Labor Department reported that the headline unemployment rate dropped to a 50-year low and that nonfarm payrolls grew more than expected. On its own, that might be the sort of thing that could spark fears of more aggressive Federal Reserve rate hikes.
But wage gains were surprisingly muted. (https://heardrundown.cmail19.com/t/d-l-zthhhhd-ithyyuikhu-t/) That could lead the Fed to take it easy at its next meeting or, barring that, to slow its pace thereafter. After a shaky start to the year, that was enough to send stocks back off to the races. The Dow Jones Industrial Average surged by 700 points, or 2.12%, while the more interest rate-sensitive Nasdaq Composite jumped 2.56%.
The good cheer wasn't enough to stave off another sharp decline in shares of Bed Bath & Beyond, though. They fell by a further 22.5% as management prepared to file for bankruptcy protection. By contrast, fellow retailer Costco saw its shares jump by 7.3% following the release of good sales data.
Stocks weren't the only things heating up. Warm weather in the U.S., and especially in Europe, contributed to a sharp selloff in natural gas prices on both sides of the Atlantic. Several records for warmth were broken this week in places like Spain and Poland. Gas in Europe is now cheaper than before Russia's invasion of Ukraine, despite Vladimir Putin's efforts to squeeze European resolve by cutting off supplies of the fuel ahead of the heating season. Perhaps not coincidentally, Mr. Putin called for a cease fire--though it appears to have been ignored by both sides.
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January 06, 2023 17:00 ET (22:00 GMT)
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