fired<\/a>\u00a0the head of the agency and accused her of manipulating the data for political purposes.\u00a0<\/p>\nAfter that, the BLS will announce its projected revision to the Current Employment Statistics establishment survey on Sept. 9, which may result in further adjustments to expectations for jobs growth.<\/p>\n
Then inflation takes the stage with the consumer price index report arriving on Sept. 11. And on Sept. 17, the Fed will give its policy decision and quarterly interest-rate projections, after which Chair Jerome Powell will hold his press conference. Investors will be looking for any roadmap Powell provides for the trajectory of interest rates. Swaps markets are pricing in roughly 90% odds that the Fed will cut them at this meeting.<\/p>\n
Two days later comes \u201ctriple witching,\u201d when a large swath of equity-tied options expire, which should amplify volatility.<\/p>\n
That\u2019s a lot of uncertainty to process. But traders seem oddly unconcerned about this crucial stretch of data and decisions. Hedge funds and large speculators are shorting the Cboe Volatility Index, or VIX, at rates not seen in three years in a bet the calm will last. And jobs day has a forward implied volatility reading of just 85 basis points, indicating the market is underpricing that risk, according to Stuart Kaiser, Citigroup\u2019s head of US equity trading strategy.<\/p>\n
Turbulence Risk<\/p>\n
The problem is, this kind of tranquility and extreme positioning has historically foreshadowed a spike in turbulence. That\u2019s what happened in February, when the S&P 500 peaked and volatility jumped on worries about the Trump administration\u2019s tariff plans, which caught pro traders off-sides after coming into 2025 betting that volatility would stay low. Traders also shorted the VIX at extreme levels in July 2024, before the unwinding of the yen carry trade upended global markets that August.<\/p>\n
The VIX climbed toward 16 on Friday after touching its lowest levels of 2025, but Wall Street\u2019s chief fear gauge still remains 19% below its one-year average.<\/p>\n
Of course, there are fundamental reasons for the S&P 500\u2019s rally. The economy has stayed relatively resilient in the face of Trump\u2019s tariffs, while Corporate America\u2019s profit growth remains strong. That\u2019s left investors the most bullish on US stocks since they peaked in February, with cash levels historically low at 3.9%, according to Bank of America\u2019s latest global fund manager survey.<\/p>\n
But here\u2019s the circular problem: As the S&P 500 climbs higher, investors become increasingly concerned that it is overvalued. The index trades at 22 times analysts\u2019 average earnings forecast for the next 12 months. Since 1990, the market was only more expensive at the height of dot-com bubble and the technology euphoria coming out of the depths of the Covid pandemic in 2020.<\/p>\n
\u201cWe\u2019re buyers of big tech,\u201d said Tatyana Bunich, president and founder of Financial 1 Tax. \u201cBut those shares are very pricey right now, so we\u2019re holding some cash on the sidelines and waiting for any decent pullback before we add more to that position.\u201d\u00a0<\/p>\n
Another well-known bull, Ed Yardeni of eponymous firm Yardeni Research, is questioning whether the Fed will even cut rates in September, which would hit the stock market hard, at least temporarily. His reason? Inflation remains a persistent risk.<\/p>\n
\u201cI expect this stock rally to stall soon,\u201d Yardeni said. \u201cThe market is discounting a lot of happy news, so if CPI is hot and there\u2019s a strong jobs report, traders suddenly may conclude rate cuts aren\u2019t necessarily a done deal, which may lead to a brief selloff. But stocks will recover once traders realize the Fed can\u2019t cut rates by much because of a good reason: The economy is still strong.\u201d\n<\/p>\n
Introducing the 2025 Fortune Global 500<\/strong>, the definitive ranking of the biggest companies in the world. Explore this year’s list.<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"The next few weeks will give Wall Street a clear reading on whether this latest stock market rally…\n","protected":false},"author":3,"featured_media":190372,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[64,11410,266,135,9580,4054,67,132,68],"class_list":{"0":"post-190371","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-markets","8":"tag-business","9":"tag-fed-interest-rates","10":"tag-inflation","11":"tag-markets","12":"tag-stock","13":"tag-u-s-jobs-report","14":"tag-united-states","15":"tag-unitedstates","16":"tag-us"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/115126256511037706","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/190371","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=190371"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/190371\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/190372"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=190371"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=190371"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=190371"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}