The labor market delivers surprisingly robust growth
The U.S. economy keeps defying expectations, even after years of largely uninterrupted growth. Its latest feat: The job market grew at a much faster pace than anticipated last month, with nonfarm payrolls rising by 165,000 in October (versus an estimate of just 70,000). That surge helped bring the overall unemployment down to 4.1%.
What’s more, employment growth during the prior two months was even stronger than initially thought. August payrolls were revised upward by 53,000, and the September count was boosted by 31,000.
Change in Nonfarm Payrolls
Bloomberg, calculations by Horizon, data as of 11/09/2026
Of course, that doesn’t guarantee investors a smooth road. Stock prices rose and fell sharply last week as investors digested the news of Democrats retaking both the U.S. House and Senate in the midterm elections by surprisingly large margins. In particular, concerns about the possibility of new Dem.-backed regulations on AI and data centers added to existing worries that AI stocks may be overvalued. That sent the tech-heavy Nasdaq-100 Index (down 11.2% so far this quarter) into correction territory.
That said, the overall market (as represented by the S&P 500 Equal Weight Index) is up 4% since the start of October—another sign that market participation is broadening out.
The upshot: While recent headlines and heightened volatility in crowded areas of the market have created some uncertainty, taking a step back reveals a more encouraging big picture. Job growth is accelerating, corporate profits remain strong, and economic activity is broadening. Markets may continue to wrestle with shifting expectations, but the underlying economy remains on solid footing as we move toward 2027.