Weekly Market Commentary - September 8, 2025
Week In Review
Market sentiment was torn between optimism and concern as a decidedly weak labor market report
provided greater assurance that the Federal Reserve would cut interest rates but simultaneously burdened investors with evolving angst regarding economic growth and corporate earnings. The U.S. economy added just 22,000 jobs in the month of August, far less than consensus expectations. Perhaps more concerning was a revision of 27,000 in payroll gains for June, shifting from an initial gain of 14,000 to a net loss of 13,000 jobs, the first loss of jobs since December 2020. 3 Modest wage growth and an increase in the unemployment rate solidified the rationale for a Fed pivot in monetary policy to assist business activity. Unfortunately, sometimes bad news is bad news. Slower hiring and rising unemployment fuels recessionary fears. In a flight to safety, the 10-year U.S. Treasury note rallied and the yield hit a five-month low of 4.08%.4 Despite the uncertainty, the S&P 500 climbed a wall of worry, up +0.3%.
This Week
After a weak employment report, investor focus will now shift to inflation, as the calendar includes
updates at both the wholesale and retail level. The venerable Consumer Price Index will be released on Thursday, and the forecast is for year-over-year CPI to increase from 2.7% to 2.9% while core CPI is slated to remain stable at 3.1%. 5 Any upside surprises could rekindle stagflation concerns and ignite greater financial market volatility.
Portfolio Theme
The Shiller P/E ratio, created by economist Robert Shiller, is calculated by dividing the current price of an index, such as the S&P 500, by the average inflation-adjusted earnings over the previous ten years.6 An above-average Shiller P/E ratio suggests a market may be overvalued. The ratio for the S&P 500 stands at the second highest level since 1900.
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Data: Unless otherwise noted, data for charts, graphs, and tables is sourced from YCharts. Portfolio Themes chart sourced from Multpl.
1 Style box returns use various Russell indices tied to specific areas of the market cap (vertical) and style (horizontal) spectrums. Indices are not typically available for direct investment, are unmanaged, and do not incur fees or expenses.
2 Index Statistics: P/E Ratio – Displays the forecasted P/E ratio of the representative index ETF. Yield - Dividend-per-share divided by current share price. Table statistics are updated weekly. MSCI indices represent broad global and international equity markets. Indices are represented by iShares ETF proxies (IVW, IVV, IVE, ACWI, and ACWX).
3 Bureau of Labor Statistics.
4 Morningstar.
5 MarketWatch.
6 Investopedia.
Past performance does not guarantee future results. Weekly commentary and investment advisory services are provided by Simplicity Wealth, LLC a SEC Registered Investment Adviser. Registration does not imply a certain level of skill or training. The information provided is for informational purposes only and does not constitute any form of advice or recommendation. The information contained within has been obtained from various sources and is believed to be accurate at the time of publication.
