Job Jitters

The latest payroll report, pushed to Wednesday after a partial shutdown, underscored a softening U.S. labor market. Layoffs are climbing, job openings are receding, and weekly jobless claims have jumped, confirming a negative trend that analysts have been tracking. At the same time, December retail sales came in well below forecasts, prompting futures traders to price in a 50 % chance of a Federal Reserve rate cut as early as April and a 60‑basis‑point reduction by June. The combination of weaker consumer spending and deteriorating employment data is reshaping expectations for the Fed’s policy path.

On the supply‑side, Taiwan Semiconductor Manufacturing Co. (TSMC) delivered a striking revenue surge of almost 40 % year‑over‑year and announced a $45 billion capital‑expenditure program to meet soaring chip demand. The growth reflects not only robust orders from U.S. hyperscalers but also a broader global AI push, exemplified by ByteDance’s negotiations with Samsung to produce its own AI‑optimized silicon. These developments place TSMC at the heart of the semiconductor renaissance and signal that capital‑intensive chip investments will remain a key driver of technology sector earnings this year.

AI’s ripple effects are now hitting the financial services arena. A startup called Altruist unveiled an AI‑powered tax‑management tool, sending wealth‑management stocks such as Charles Schwab, LPL and Raymond James tumbling more than 5 % in a single session. The sharp sell‑off highlights investor uncertainty about how quickly AI can erode traditional advisory revenue streams and raises speculation that larger firms may seek to acquire niche AI innovators. As AI tools proliferate, market participants will watch closely for both disruption risks and acquisition opportunities.