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Some interesting news came out over the past week, perhaps most surprising were core retail sales and overall retail sales data from the month of September. It showed that core retail sales increased .6 percent, while overall retail sales were up .7 percent over the past month.

This was significantly higher than the expected increases of .2 percent and .3 percent respectively. Furthermore, retail sales data from the month of August was revised upward to show that core retail sales increased .9 percent while overall retail sales increased .8 percent during that month. An increase in wages was cited as the reason why these figures were so strong, and it has caused some to speculate that the Federal Reserve may not be done with their current hiking cycle.

On Thursday, unemployment claims data was released and showed that there were 198,000 requests for unemployment benefits during this time period. This was down from 211,000 requests from a week ago, which is another sign that the economy is doing well despite being in a period of restrictive monetary policy.

Thursday also featured remarks from Federal Reserve Chairman Jerome Powell. He said that it was possible that interest rates had less of an effect on the economy than imagined. He also said that the full impact of rate hikes may not have been felt yet as it takes time for the impact of restrictive policies to take effect. Therefore, Powell said that there was a need to be patient and cautious as it relates to future rate decisions.

Powell also said that it may take a period of economic weakness to bring inflation down from 3.7 percent to the Fed’s target of 2 percent. However, he did mention that the situation was much better than it was a year ago when inflation was at 9.1 percent.

Although it was sort of lost in the shuffle given the other news, Monday saw the release of the Empire State Manufacturing Index. It came in at -4.6 percent, which was higher than the expected -6.4 percent but still lower than the 1.9 percent reading from last month.

The Dow lost 2.3 percent this week to finish at 33,127 at the close of Friday’s trading. On Tuesday, the market made its high of the week at 34,142 and would continue to lose ground until Friday when it closed at its weekly low.

The Nasdaq had an even steeper decline this week as it dropped 3.59 percent over the past five trading days. On Tuesday, the market hit its high of 13,601 before reversing and steadily declining for the rest of the week. Friday was the worst day of the week for the market as it accounted for almost half of the index’s losses over the past several days.

The S&P 500 would also suffer through a poor week losing 2.93 percent to finish at 4,224. As with the other major indices, it would make a high on Tuesday before losing ground the rest of the week. The weekly high was 4,392 while the market would end trading on Friday at its weekly low.

Next week will be an extremely busy. On Tuesday, Flash Manufacturing and Flash Services PMI reports will be released while gross domestic product (GDP) figures for the second quarter will be made public on Thursday. Jerome Powell is also expected to speak late Thursday afternoon. The Core PCE Price Index for the month of September is scheduled for release on Friday. The University of Michigan is also set to release its revised consumer sentiment and inflation expectation reports on Friday morning.

Internationally, interest rate decisions will be made in Canada and the European Union while Australia is set to release its most recent inflation figures. The results of these decisions and inflation reports will likely play some role in what the Fed decides to do during its November meeting.

The first week of October was interesting as a government shutdown was averted with hours to spare. That meant that a variety of important news releases were released at their scheduled times. Of course, the main event this week was the release of nonfarm payroll figures on Friday morning.

According to the Bureau of Labor Statistics (BLS), companies added 336,000 jobs over the past month. This was well above the 171,000 forecast prior to the news release and the 227,000 added in August. The positive number elevated concerns on Wall Street that another interest rate hike may be on the table in November or December. However, some insiders also acknowledged that strong jobs numbers may also signal a greater chance at a soft landing.

A soft landing refers to the possibility that the economy can avoid a recession during a period of fiscal tightening. Even if rates stay where they are, guidance from the Fed has suggested that they will remain elevated for some time, which may influence equity prices and the overall economy moving forward.

The ADP nonfarm employment change report was released on Wednesday and revealed that employers had added 89,000 new jobs in the past month. This was significantly lower than the forecast of 154,000 new jobs and the 180,000 jobs created during the month of August.

In other news, the ISM Manufacturing PMI figure was released on Monday and came in at 49 percent. This was higher than the forecast of 47.8 percent and was also higher than last month’s figure of 47.6 percent. On Wednesday, the ISM Services PMI was released and came in at 53.6 percent, which was roughly in line with expectations.

On Tuesday, the Job Openings and Labor Turnover Survey (JOLTS) came out and revealed that there were 9.61 million available jobs in the United States as of September 2023. That figure represented an increase from 8.83 million last month and was higher than the 8.81 million figure projected by analysts prior to the release.

On Thursday, unemployment claim figures were released, and there were 207,000 requests for benefits during the previous seven days. This was slightly higher than the 205,000 claims from the previous report and lower than the 211,000 that analysts had expected to see.

On Friday, average monthly earnings and unemployment figures for September were released. Average hourly earnings increased by .2 percent in September, which was slightly lower than expected. The unemployment rate came in at 3.8 percent, which was the same as it was in August.

The Dow was up 43 points this week to finish at 33,407. For most of the week, the market stayed in a tight range 32,885 and 33,120 before breaking out on Friday after the nonfarm payroll report was released. On Friday, the Dow hit its weekly high of 33,550 before easing back in the afternoon.

The S&P 500 finished the week up 40 points to close at 4,308. Like the Dow, the S&P spent the week in a tight range before breaking out on Friday. During the final session of the week, the market hit its weekly high of 4,325 and also made its weekly low of 4,220.

Finally, the Nasdaq finished the week at up 175 points at 13,431. Unlike the other two markets, the Nasdaq would finish the week at its highest point. On Tuesday, the Nasdaq made its low of the week at 13,019.

The upcoming week will have a quiet start as Monday is the Columbus Day holiday. However, important releases are scheduled for Wednesday and Thursday as both price and inflation data are scheduled to be made public. Analysts are expecting yearly CPI to come in at 3.6 percent, which would be slightly less than the 3.7 percent figure for August. Monthly CPI is expected to be .3 percent, which would represent a 50 percent drop from last month’s .6 percent reading. Finally, the University of Michigan will release its preliminary inflation and consumer sentiment reports on Friday morning.