What's Coming This Week: Key Economic Reports Set to Move Markets

Futures trading shows a mixed picture in early sessions, with the tech-laden Nasdaq down -103 points and the S&P 500 off by -2, while the Dow gains +110 and Russell 2000 adds +2. Market sentiment remains shaky as investors grapple with questions about whether AI infrastructure investments will sustain momentum through the year ahead.

Broadcom’s Caution Signals Broader Concerns

The uncertainty intensified after Broadcom AVGO reported earnings yesterday. Despite generally strong results, CEO Hock Tan’s comments about softer-than-anticipated AI product orders next year spooked the market. Though Tan later clarified that his company’s $73 billion backlog represents a floor rather than a ceiling, shares are trading down -5% in pre-market activity. This signals deeper doubts about whether the current AI spending trajectory is sustainable.

Next Week’s Economic Crossroads: Employment and Inflation Data

The coming week brings two pivotal economic reports that could reshape market direction. On Tuesday, the U.S. Bureau of Labor Statistics (BLS) will release the Employment Situation report for November—a data point investors have been anticipating for weeks, given that October’s figures were skipped due to the recent government shutdown.

The labor market picture has grown cloudier. September saw +119K jobs added with unemployment at 4.4%—the highest level in four years. While +119K isn’t alarming on its surface, context matters. Over the last four months, the average job creation has fallen to just +44K monthly—below the +100K considered necessary to offset retiring Baby Boomers and older Gen-X workers. Compare this to +100K average four months prior, and +185K the four months before that: the trend reveals clear labor market weakness accumulating over the past year. With corporate restructuring making headlines and immigration policy shifts affecting workforce supply, the upcoming jobs report may show continued softening rather than improvement.

Thursday brings equally important data: the November Consumer Price Index (CPI) report, which will provide the fresh inflation reading the market has been missing due to the October data gap. The last reading showed +3.0% year-over-year inflation for the first time since January. Looking at the pattern: +3.7% in September 2023, +3.5% in March 2024, and +3.0% by January 2025, we’ve observed a pattern of declining highs and lows. Yet the recent return to +3.0% suggests inflation may be stabilizing at a higher floor than earlier hoped—a shift that could alter Fed policy expectations.

The Bigger Picture: Fed Policy at a Crossroads

These two reports matter because markets face genuine uncertainty about economic trajectory. While GDP growth and inflation projections through 2026 remain relatively optimistic, Federal Reserve leadership under Chair Jerome Powell appears inclined toward caution in upcoming meetings. The disconnect between positive long-term forecasts and current labor market weakness creates the kind of ambiguity that historically prompts central banks to pause and reassess. Next week’s data will likely determine whether that cautious stance hardens into something more restrictive—or whether it signals the Fed may have more room to maneuver in early 2025.