As of the time of writing, the three major USA stock indices are all down, with the S&P 500 falling by 0.13%, the Nasdaq down by 0.15%, and the Dow down by 0.18%.

On Thursday, the USA stock market will be closed in memory of former President Jimmy Carter, who recently passed away.

According to reports, elected President Donald Trump is considering declaring a national economic emergency to push for new tariff policies.

On Wednesday, economic data showed that private enterprises in the USA added 122,000 jobs in December, the lowest in four months and below market expectations, according to data released by ADP Research and the Stanford Digital Economy Lab.

The average expectation of 23 economists surveyed was an increase of 140,000, with a prediction range of 100,000 to 160,000. The ADP employment data for November in the USA was revised to show an increase of 146,000.

The ADP employment report indicates that the hiring pace in the USA private sector slowed in December, suggesting a continuing decrease in demand for workers.

Job growth across industries was uneven. The largest increases were seen in Education and Medical Services, Construction, as well as Leisure and Hospitality. However, employment numbers in Manufacturing, Natural Resources and Mining, as well as Professional and Business Services decreased.

The ADP employment report data indicates that the trend of a gradually weakening labor market in the USA will continue until the end of this year. Federal Reserve officials must balance this trend with the rekindled inflation concerns when determining the extent of interest rate cuts in 2025 and beyond. Wage growth has further cooled, with wage growth for job changers at 7.1%, while the growth for non-changers is at 4.6%, marking the slowest growth rate since mid-2021.

The US Department of Labor reports that the number of first-time unemployment claims last week was 0.201 million. The average expected value of 34 economists surveyed was 0.215 million, with a forecast range of 0.2 million to 0.235 million. The four-week moving average was 0.213 million.

The minutes of the Federal Reserve's December monetary policy meeting are scheduled to be released at 2 PM Eastern Time.

Traders are assessing whether the sell-off of US Treasury bonds and stocks on Tuesday was an overreaction.

US stocks fell sharply on Tuesday, as the ISM (Institute for Supply Management) services index released that day showed the expansion of the US services sector exceeded expectations, raising concerns that future inflation would remain high and reducing the justification for the Federal Reserve to cut interest rates this year.

The ISM services data indicated that prices rose this month, triggering concerns over stubborn inflation and questioning the Federal Reserve's trajectory of rate cuts this year.

The number of job vacancies unexpectedly increased, while hiring slowed, suggesting that the pace of the labor market slowdown may not necessitate the Federal Reserve rushing to cut interest rates.

The Chief Economist of Singapore Banks, Mansoor Mohi-uddin, stated: "The data supports our view that the USA economy should achieve a soft landing this year, which is beneficial for risk assets, while also limiting the Federal Reserve to only lowering interest rates 1-2 times."

According to the FedWatch tool of CME Group, the market currently prices in a 95% likelihood that the central bank will not lower interest rates at this month's meeting.

The market is also paying attention to the policies of the newly elected President Trump and their potential impacts. According to media reports citing informed sources, Trump is considering declaring a national economic emergency to provide a legal basis for widespread tariffs. Declaring an economic emergency would allow Trump to utilize the International Emergency Economic Powers Act (IEEPA) to formulate new tariff plans.

As the market determines that Trump's tariff and tax plans will lead to soaring inflation, U.S. Treasury yields have continued to rise recently. On Wednesday morning, the yield on the benchmark 10-year U.S. Treasury bonds broke 4.7%, approaching levels seen since late April.

Ayako Yoshioka, director of portfolio consulting at Wealth Enhancement Group, believes that the optimistic outlook for the market in 2025 remains intact; however, the path to achieving 'decent' returns is becoming more unstable.

Ayako Yoshioka stated, 'We have a lot of different messages in flux, whether in terms of growth, inflation, or policy changes. These can sometimes make the market feel uneasy, but I believe that overall, they are all buying opportunities in the long run.'

This week's market focus is on Friday's December non-farm payroll report. Analysts expect December.Non-farm employmentIt will increase by 0.16 million people, while in November it rose sharply by 0.227 million people.

James Knightley, the chief international economist at ING Groep, stated that good growth, high inflation concerns, and a slowdown in the job market without collapse continue to lead to market reductions in expectations for rate cuts this year. 'The risk is that if strong employment data and a 0.3% month-on-month core CPI increase appear again next week, market expectations for rate cuts may further decrease.'

Focus on individual stocks

Growth tech stocks fluctuate. $NVIDIA (NVDA.US)$Increased by nearly 2%, $Tesla (TSLA.US)$Up 0.55%, $Advanced Micro Devices (AMD.US)$Down over 3%

Most AI Application software Stocks fell,$SoundHound AI (SOUN.US)$Down over 10%,$Palantir (PLTR.US)$Down more than 2%, $Applovin (APP.US)$Up by 0.76%.

Quantum Computing stocks fell broadly. $Rigetti Computing (RGTI.US)$Fell by over 42%.$IonQ Inc (IONQ.US)$Fell by more than 37%.

Biotechnology Company$Sana Biotechnology (SANA.US)$Increased by over 240%, the company announces positive clinical results for its non-immunosuppressive type 1 diabetes islet cell transplantation study.

$eBay (EBAY.US)$US stocks rise over 11%, Meta will test displaying eBay product listings on Facebook Marketplace.

Fintech company.$Currenc Group (CURR.US)$Surging by over 200%, the company announced the launch of an AI call center.

AMD invests $20 million in Absci. $Absci Corp (ABSI.US)$Increased by more than 13%.

Editor/ping