Market Recap Week of 10/3/2022 Through 10/7/2022

The S&P 500 index rose 1.5% last week, kicking off the final quarter of 2022 in positive territory following three weeks of declines.

The slight weekly advance came as gains booked earlier in the week on hopes for rate increases to start slowing managed to more than offset a slide posted later in the week as stronger-than-expected September jobs data seemingly dashed those hopes.

Investors were hoping slowdowns in the economy and labor market could be signs the rate increases are already working and could prompt central banks to slow the pace of future rate increases.

However, September jobs data in the US, released Friday, showed nonfarm payrolls rose by 263,000 last month, slightly ahead of the 250,000 jobs increase expected in a survey compiled by Bloomberg. The unemployment rate, which had been expected to have no change from August, unexpectedly improved to 3.5% in September from 3.7% in August.

The S&P 500 fell 2.8% on Friday as the stronger-than-expected jobs data prompted investors to resume expectations for the Federal Open Market Committee to keep up a more aggressive pace of rate increases.

Despite the Friday losses, seven of the S&P 500’s 11 sectors still ended the week in positive territory versus last Friday. The energy sector posted the strongest advance with 14% climb, followed by a 2.9% increase in industrials and a 2.1% rise in materials.

The four declining sectors were led by real estate, which fell 4.2%, followed by a 2.6% decrease in utilities, a 1.1% decline in consumer discretionary and a 0.4% slip in consumer staples.

This week, the Q3 earnings reporting season will kick off with reports expected from companies including Wells Fargo (WFC), Delta Air Lines (DAL), JPMorgan Chase (JPM), Morgan Stanley (MS), Citigroup (C) and UnitedHealth Group (UNH).

Economic reports expected to receive attention this week include the September consumer price index on Thursday and September retail sales on Friday.

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