Citizen's Wealth: Markets were surprised by the jobs data in an environment with low volatility

Market Reaction and Data Trust - The market is likely to react to the surprise in data, potentially leading to back and forth trading sessions [2][3] - The industry continues to trust the data, despite recent revisions and estimations in inflationary reports [5] - Every report needs scrutiny due to the coinciding turn in Fed policy, requiring an overall mosaic approach [6] Fed Policy and Labor Market - The Fed might have acted differently on rate policy with correct data, but full consensus for a cut last week was uncertain [8] - The market perceives the labor market as more important than inflation, a view telegraphed by the Fed [8][9] - Fears of the Fed being behind the curve are expected to escalate into September [9] - Political challenges of elevated unemployment are considered more acute to the Fed historically [11] Investment Strategy - Current guidance advises clients to stay overly diversified, which has driven performance across risk spectrums this year [12] - Fixed income acted as a ballast during the equity drawdown, and some foreign markets have been supportive [12][13] - The industry is constantly looking for opportunities to add or incrementally take down risk depending on the environment [13]