Weekly Commentary (08/10/2026) - Stocks Surge as Weak Jobs Data Complicates the Fed’s Next Move

Weekly Commentary (08/10/2026) - Stocks Surge as Weak Jobs Data Complicates the Fed’s Next Move

Stocks moved sharply higher last week as strong corporate earnings and softer economic data overcame continuing geopolitical uncertainty. The biggest economic surprise came from the July employment report, which showed the U.S. economy losing 23,000 jobs versus expectations for an increase of roughly 80,000. Earlier months were also revised lower. The unemployment rate declined to 4.1%, but largely because fewer people were participating in the labor force, while annual wage growth slowed to 3.2%. Other labor indicators, including ADP employment and job openings, generally reinforced the picture of a labor market that is losing momentum.

That complicates the Federal Reserve’s job. At its July meeting, the Fed held its overnight rate at 3.50%-3.75%, but the 9-3 vote was unusually divided, with three members favoring a ¼-point increase. Inflation remains above the Fed’s target, while the weaker employment data released since the meeting argues for greater caution. The Fed therefore faces an increasingly uncomfortable balance: inflation and elevated energy costs argue against easing policy, while slowing employment makes additional tightening more difficult to justify. The July decision was a “hawkish hold”; the data since then have made the September decision considerably less straightforward.

Corporate earnings continue to provide a powerful counterweight. With most S&P 500 companies having reported, second-quarter results have substantially exceeded earlier expectations, supporting stock prices despite the uncertain economic backdrop. The strength has extended beyond a handful of technology companies, although several unusually large results have boosted the headline earnings-growth numbers.

Geopolitical news also became somewhat less threatening to markets. The U.S.-Iran conflict continued to seesaw between threats and negotiations, but progress toward an arrangement involving shipping through the Strait of Hormuz helped push oil prices lower. By Friday, U.S. officials were reporting meaningful progress toward a potential agreement. Markets increasingly appear willing to discount each new headline rather than immediately price in a worst-case outcome—but the situation remains far from resolved.
We continue to advise investors to be disciplined in adhering to their investment policy and patient when the markets’ winds are pushing against the planned course.

“Successful investing is about having people agree with you … later.” – James Grant

Sources Market data: J.P. Morgan Asset Management, Weekly Market Recap, August 10, 2026. Index returns, yields, key rates, and commodity prices as cited in the Weekly Data Center. All equity returns represent total return for stated period. Oil and Gold: Wall Street Journal Markets Digest, August 10, 2026. Economic data: MarketWatch.com. Charts and portfolio data: YCharts.com.
NDS Wealth Advisors believes these sources are reliable but cannot guarantee the accuracy or completeness of third-party data and assumes no liability for errors or omissions.
Disclosures This material is for informational and educational purposes only and should not be relied upon as investment, legal, or tax advice, or a recommendation of any particular security, strategy, or investment product. Any economic forecasts or market outlooks expressed herein are forward-looking statements, subject to change without notice, and may not materialize. Investors cannot invest directly in an index. Index returns do not reflect the deduction of fees, commissions, or expenses, which would reduce overall performance. Past performance does not guarantee future results. Diversification does not guarantee investment returns and does not eliminate the risk of loss. This material does not consider the investment objectives, financial situation, or unique needs of any individual investor. Consult your financial advisor before making any investment decisions.