Thursday's Scoop: Digesting☀️

Hey friends - almost Friday.

Insiders, look out for the Weekly Scoop tomorrow.

Here’s what you need to know today to inform your work, spending, and investments:

1. Employers are still hanging onto their workers.

2. Businesses aren’t dealing with much inflation.

3. New Yorkers are getting some relief on apartment costs.

Unemployment Rate: 4.1%
^{Relatively low, but up from record lows.}

Layoffs remain low, indicating the job market is holding up well despite recent disruptions. The Labor Department reported that initial claims for unemployment benefits fell to 217,000 last week, slightly below economists' expectations. This suggests fewer people are losing their jobs, even after the impact of Hurricanes Helene and Milton and the Boeing and shipping port strikes, which had temporarily spurred more layoffs and furloughs. Additionally, the number of people receiving unemployment benefits for consecutive weeks dropped to 1.873 million, meaning more people are finding work. While hiring has slowed, it seems employers are holding onto their workers.

Inflation Rate: +2.6% (YoY), +0.2% (MoM)
^{Policymakers aim for 2% YoY inflation. (October CPI)}

Businesses aren’t dealing with much inflation. Wholesale prices increased only slightly in October, suggesting that inflation remains under control. The Labor Department reported that the Producer Price Index (PPI), which measures the prices businesses receive for their goods and services, increased by 0.2%, matching what economists expected. Over the past year, wholesale prices have risen 2.4%, only slightly higher than policymakers’ target of 2% annual inflation. When excluding volatile food and energy costs, core PPI rose 0.3% for the month and is up 3.1% compared to last year. If businesses aren’t dealing with major inflation anymore, that’s a good sign that they won’t be passing higher costs onto shoppers.

30yr Mortgage Rate: 6.9%
^{That’s down from 7.6% a year ago. (MBA)}
Median Home Price: $404,500
^{That’s up from $393K a year ago. (Existing homes - NAR)}

New Yorkers are getting some relief on apartment costs. The New York City Council passed a bill requiring landlords to pay broker fees instead of tenants, aiming to reduce upfront costs for renters. According to reports from Douglas Elliman Real Estate and Miller Samuel Inc., Manhattan's median rent climbed to $4,295 in October, up 2.4% from last year and approaching record highs. With rents remaining high and competition for apartments intense, the new rule could help ease some financial pressure for those seeking housing in the city. However, some experts caution that landlords might raise rents to offset these additional costs, so the overall impact on affordability is still uncertain. This change could mean lower initial expenses when securing an apartment for renters, but high monthly rents may continue to strain budgets.

The Market:⬇️ -0.6%
S&P 500: 5,949.17
1Mo: +2% | 1Yr: +32% | 5Yr: +91%

The market drifted lower again on Thursday as investors pared back their enthusiasm for the next administration's proposed policies. The excitement for deregulation and tax cuts that fueled the market rally last week has turned to caution and concern about how the government will pay for the tax cuts and whether tariffs will reignite inflation.