- Today's Scoop:
Hey friend - markets are closed tomorrow. Look out for our Weekly Scoop in the morning and our Explained on Sunday about investing through a recession. Have a happy Thanksgiving!
Here’s what you need to know today…
Layoffs may be rising.
Consumers are feeling less optimistic.
Crypto is still weeding out its bad actors.
The Market: ⬆️ +0.4%
S&P 500: 4,556.62
1Mo: +8% | 1Yr: +13% | 5Yr: +73%
The market drifted sideways today as investors put up their out-of-office messages. Markets are closed tomorrow for Thanksgiving.
Layoffs may be rising, but it’s hard to tell. According to the Labor Department, the number of Americans filing initial claims for unemployment benefits dropped by 24,000 to 209,000 last week, the biggest drop since June. For the first time in two months, the number of people still unemployed for at least a second week dropped for the first time in two months, suggesting that more Americans were able to find work. While those are both good trends, holiday numbers can be misleading due to seasonal adjustments to make the year-over-year numbers sync better. On an unadjusted basis, layoffs hit the highest level since July, and continuing claims rose by the most in four months.
Americans are still feeling weary about the economy, given the high living costs. The University of Michigan's consumer sentiment index dropped for the fourth consecutive month in November. Most of this was driven by younger and middle-aged consumers who expect the cost of living to continue rising swiftly. Consumer spending makes up two-thirds of the economy, so investors watch sentiment carefully.
The crypto world still isn’t entirely reliable. Binance, the world's biggest cryptocurrency exchange, has been accused of breaking US financial laws. The platform did not have any measures to prevent money laundering or currency exchanges from foreigners with sanctions against them. Binance agreed to pay $4.3 billion, one of the largest settlements in US history. Binance founder Changpeng "CZ" Zhao pleaded guilty, paid a $50 million fine, and stepped down as CEO. US authorities have increased scrutiny of the cryptocurrency industry given the massive fraud by the second-biggest exchange, FTX, before its collapse.
How are you feeling about the economy?
Company Scoops 🗣️🌎💰
(These links only work for 24 hours while the story is live.)
Inside Scoop 🤓
How do the holidays affect markets?
The holidays can be a particularly volatile time for markets. Despite seeming like a big machine, the market is driven by people. Fewer traders at their desks and fewer fund managers making investment decisions can have a tangible effect on the volume of stock traded each day.
There can be wider swings in prices in a market with fewer participants. If you had a thousand people guess what they think a toaster costs, you would likely see many of the same guesses or slight differences in the middle of the range of price guesses. But, the more people you take away, the fewer overlapping opinions and wider the gaps in price estimates. That's what happens in the stock market. Fewer trades mean wider jumps in prices.