Like an Advent calendar… Instead of chocolate, the surprise is labor market #s. On Friday, the Labor Department will release unemployment data for November. In October, the unemployment rate ticked up to 3.7% and stocks reacted positively (bad news = good news). While unemployment’s still near historic lows, we saw a fresh wave of layoffs this month, from Twitter to Amazon to Meta (Google might be next). But tech openings are still above prepandemic levels, and widespread layoffs across industries remain low. That could be changing: last week’s jobless claims hit their highest level since August.
Not-so-silver cloud lining… Shares of Salesforce, Snowflake, and Workday have lost nearly half their value this year as higher interest rates curb cloud spend. Salesforce's revenue rose 22% last quarter, but it cut its full-year forecast as the strong US dollar (and slowing demand) pressure profits. But as tech layoffs pile up, companies are still investing in cloud software to help them do more with less. Cloud spend is forecast to grow 21% next year, but analysts aren’t expecting breakthrough results when the cloud companies report this week.