2026-09-04 · Jobs Shock Revives the Hike Trade
A much-stronger-than-expected August jobs report pushed rate-hike odds sharply higher and hit small caps hardest, while the tape underneath showed an unusually clean rotation out of this year's winners and into the sectors left for dead.
The Signal
August payrolls beat expectations by a wide margin with unemployment holding steady, and futures markets pushed the odds of a rate hike at this month's Fed meeting sharply higher overnight. Smaller, more rate-sensitive companies sold off hardest while the major indexes only slipped modestly. The next two checkpoints are next Friday's…
The skinny
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