By Barbara Kollmeyer
Summit Entertainment/Courtesy Everett Collection
Tuesday is looking dicey for stocks, notably the technology space, as inflation jitters continue to ripple across markets. The sector has been bearing the brunt of concerns that higher inflation may prompt an early end to the Federal Reserve’s COVID-19 pandemic-driven accommodative stance.
After last week’s downside jobs surprise, some fear Wednesday’s consumer price data could also deliver a nasty shock. Not helping are fresh Chinese data on Tuesday showing surging factory-gate prices, though the consumer side was subdued. That is as investors continue to monitor fallout from a downed U.S. energy pipeline.
Small businesses are no exception.
The National Federation of Independent Business (NFIB), the nation s largest small business association, released a report on Tuesday that found that while small business optimism increased by 1.6 points since March, a record 44% of owners reported job openings that could not be filled in April. Also, 36% of owners reported raising their selling prices the highest reading since 1981. Small business owners are seeing a growth in sales but are stunted by not having enough workers, NFIB Chief Economist Bill Dunkelberg said in a statement. Finding qualified employees remains the biggest challenge for small businesses and is slowing economic growth. Owners are raising compensation, offering bonuses and benefits to attract the right employees.
Provided by Dow Jones By Xavier Fontdegloria Optimism among small-business owners in the U.S. continued to rise in April on the reopening of the economy, with firms struggling to find workers to fill job openings and increasingly raising selling prices. The NFIB Small Business Optimism Index came in at 99.8 in April, up 1.6 points from the previous month, data from a survey compiled by the National Federation of Independent Business showed Tuesday. The reading is below the 101.1 expected by economists polled by The Wall Street Journal. The index increased for the third successive month and stands over its long-term average. However, it is still below the 104.5 level registered in February 2020, before the pandemic first hit the U.S.
The Big Miss
Macro Tides Weekly Technical Review 10 May 2021
From Jay Powell s perspective it didn t matter if 1,000,000 jobs were created in April or the 266,000 that were added according to the Labor Department. Jay and the FOMC are committed to waiting for the unemployment rate to fall significantly and for core inflation to rise above 2.0%.
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I did an interview with Blake Morrow from FORX Analytix on Friday and discussed the employment report and the Fed s potential reaction:
For decades the FOMC was guided by the Phillips Curve, which showed that inflation perked up once unemployment fell to a low level. This framework led the FOMC to begin increasing the federal funds rate whenever unemployment fell below what their Phillips Curve model indicated was the lower bound threshold in anticipation of rising inflation.
Gov. Bill Lee opts Tennessee out of $300 federal unemployment supplement, other programs Natalie Allison, Nashville Tennessean
Tennessee is withdrawing from a $300 weekly unemployment supplement program, a decision by Gov. Bill Lee that comes as many Republicans argue the additional funds allow low-wage workers to make more money while staying at home.
Lee informed the U.S. Department of Labor of the decision Tuesday, joining several other Southern states in refusing the additional payments for unemployed people. We will no longer participate in federal pandemic unemployment programs because Tennesseans have access to more than 250,000 jobs in our state,” Lee said in a statement about the decision. “Families, businesses and our economy thrive when we focus on meaningful employment and move on from short-term, federal fixes.