Daily Commentary

MarketMinder’s View: This article mentions some specific companies, so we remind readers MarketMinder doesn’t make individual security recommendations. Our focus is on the broader theme only: What do rising job cuts mean for investors? At the top, the article discusses how companies in America and Europe are reducing headcount, and without the latest labor data from the Bureau of Labor Statistics to confirm either way, these anecdotal layoff stories may signal trouble for the broader economy. The bulk of the piece explores why companies may be laying off workers, with reasons ranging from tariff costs to AI investment replacing some entry-level work. So far, the evidence for the latter seems scant: “Businesses loaded with white-collar workers such as those in the information, finance, and professional services sector have seen job growth in tandem with increased AI usage, [economists] wrote.” As for the overall economic effect, remember jobs are late-lagging economic indicators, so whether they are growing or contracting, they aren’t likely to shed much light on where the economy is headed next. Moreover, some high-profile examples aside, “Weekly state jobless figures so far do not show a measurable surge in layoffs, but job growth remains subdued. Payroll provider ADP on Tuesday estimated an increase of 14,250 jobs in the four-week period ended Oct. 11.” The available data are in better shape than the discussions surrounding them—a sign the bull market has more wall of worry to climb.

MarketMinder’s View: The Trump administration is facing minor congressional pushback to its trade agenda. As this gets political, please note MarketMinder is nonpartisan, favoring no party or politician, and assesses legislation solely to determine its potential market implications. As the headline hints, the Senate resolution—passed with five Republicans and all Democrats—would overturn the “national emergency” used to justify the administration’s “sweeping tariffs on Brazilian imports, including coffee, beef and other products, in a rare bipartisan show of opposition to the president’s trade war.” But as the article also adds, the House of Representatives probably won’t pass the measure, and in the unlikely event the lower house does, the President has veto power. So why is this worth noting for investors? “While congressional Republicans have largely declined to rein in the president, Tuesday’s vote revealed an underlying discontent with Trump’s tariffs.” Now, with the Supreme Court set to consider Trump’s tariffs implemented through the emergency economic powers act, some lawmakers are waiting to see what the highest court in the land will say before acting. If the Supreme Court doesn’t uphold lower courts’ decisions, Congress could step in and reassert its power over taxation. Whether it has the votes remains to be seen, but we think this is a development to watch given next year’s midterm elections, ongoing grumblings over living costs nationally and tariffs’ poor polling.

MarketMinder’s View: The titular deal is “pretty much finalized,” according to President Donald Trump, so here are some of the details. In exchange for the US lowering tariffs on South Korean goods to 15% from 25%, Seoul will now “make $150 billion in [American] shipbuilding investments, with an additional $200 billion earmarked for an investment pledge designed to look like a similar agreement with Japan, South Korea Policy Chief Kim Yong-beom said Wednesday. That suggests South Korea can use not only equity but loans and loan guarantees to fund the investment package, a key concession.” That helps clear some uncertainty, particularly for Korean automakers since US duties on car imports “had remained at 25% while the talks continued. That left the nation’s automakers at a competitive disadvantage against their Japanese rivals since Tokyo finalized its deal in September. Those duties will now come down to 15%, according to Kim.” A couple of things for investors to note here. First, the “deal” is technically a memorandum of understanding, which isn’t legally enforceable, so a bit of uncertainty lingers. Second, it is also unclear what the agreement’s status will be if the US Supreme Court strikes down tariffs. With oral arguments before the Supreme Court starting November 5, this might all be moot—or subject to renegotiation—in a few weeks. Not that that would necessarily shock stocks, which are well aware of the proceedings.