U.S. jobs data today: Matt Maley says the S&P 500 is ‘expensive’ at current levels

on Aug 4, 2023
  • U.S. economy did not add as many jobs in July as expected.
  • Miller Tabak's Matt Maley shares his view on the S&P 500.
  • The benchmark index is currently up about 20% year-to-date.

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S&P 500 is trading up this morning after the Bureau of Labour Statistics said the U.S. economy did not add as many jobs last month as expected.

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Jobs still grew month-over-month

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Nonfarm payrolls increased by 187,000 in July versus the economists’ forecast for 200,000.

Month-over-month, though, the figure represents a gain from 185,000. Still, Matt Maley – the Chief Market Strategist of Miller Tabak warns the possibility of a recession remains on the table.

It’s usually a year later that we see the impact of [yield curve] inversion. We’re just starting to see some issues, like the consumer, seeing a few cracks there. So, I’m not sure recession is completely off the table.

Unemployment rate stood at 3.5% last month versus 3.6% expected. The benchmark index is up roughly 20% for the year at writing.

Maley’s view on the S&P 500

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Most importantly, average hourly earnings – a metric that the central bank watches closely, was up 0.4% for the month and 4.4% on a year-over-year basis.

The Dow Jones estimate was for 0.3% and 4.2%, respectively. Sharing his view on the equities market, Maley said today on CNBC’s “Worldwide Exchange”:

We’re 21 times 2023 earnings, almost 20 times the next 12 months earnings. That’s expensive. When you’ve got interest rates higher, it makes it much harder to justify [current] valuations.

The news arrives shortly after the U.S. Federal Reserve raised rates by another 25 basis points but said it “may” end up being its last hike of the cycle as Invezz reported here.


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