AE Wealth Management: Weekly Market Insights | 8/31/25 – 9/6/25
Weekly Market Commentary
THE WEEK IN REVIEW: Aug. 31-Sept. 6, 2025
Jobs dry up
The week started with an appeals court ruling that President Trump’s use of tariffs was unlawful (see more in the next section) and markets nosedived before recovering to start off a short trading week.1
Then we had news that Russian President Putin invited Ukrainian President Zelenskyy to meet in Moscow, which seemed positive until realizing that Zelenskyy visiting Moscow would be like someone showing up in front of a prison and asking to serve a life sentence.2 Markets shrugged all that off, and we eked out a new high for the S&P 500 while the Nasdaq and Dow came close to new highs on Thursday.3,4,5
On Friday, the Bureau of Labor Statistics (BLS) employment situation report showed only 22,000 new nonfarm jobs were created in August.6 (Consensus was calling for +75,000.) This was on top of the meager 79,000 jobs created in July.
Remember, Trump fired the person running the BLS last month, claiming data manipulation for political reasons, causing outrage in some quarters that the data from the BLS would no longer be unbiased.7 But if anyone was expecting a “politically biased” job reading, the new Commissioner of Labor Statistics EJ Antoni clearly did not get the memo.8 Adding 22,000 new jobs in a country with a workforce of 210 million might as well be zero and was clearly not advantageous to the president.
Other sources backed up the dismal job growth. The Job Openings and Labor Turnover Summary (JOLTS) figure for July showed a drop of nearly 200,000 openings from June.9 JOLTS is a lagging report, so we can only assume job openings have continued to decline. For the first time in nearly five years, we have fewer job openings than those seeking jobs. Plus, the jobs that are open are skilled positions that job seekers don’t necessarily align with. (More on that in a minute.)
The ADP employment reading was equally uninspired, coming in at +54,000 and missing the consensus +68,000.10 Now the great debate begins: Is the economic slowdown and lack of jobs growth due to the Federal Reserve keeping interest rates too high for too long? Or have the jobs dried up because of uncertainty around tariffs?
It seems like jobs created since the pandemic were predominantly lower paying (hospitality and retail), “pseudo government” (health care and education) or straight government jobs. Higher interest rates make the cost of doing business more expensive and credit card balances weigh more heavily on the consumer, so people cut back on travel, going out to eat or buying things. As a result, there’s less need for hospitality or retail workers. (Not to mention that a lot of those jobs were rehires from the early days of the pandemic.) Then there is the Trump administration cutting funding and trimming the federal workforce.
The market acted as expected, at first cheering the weak jobs number because it would force the Fed to cut rates. Then it moved to worrying about the economy heading into a recession. It appears there’s plenty of blame to go around, but that’s small comfort if you’re looking for a job. The reasons don’t matter as much as the lack of opportunities.
Obstacles continue to arise for Trump’s tariffs
A federal appeals court ruled last week that what President Trump is doing with tariffs does not constitute a response to an emergency and is therefore in violation of the International Emergency Economic Powers Act (IEEPA). Trump was using the act as the basis for announcing tariffs.
In their decision, the court said: “The government has now asked the U.S. Supreme Court to review this case. Both federal courts that considered the issue agreed that IEEPA does not give the president unchecked tariff authority.”11
There are other ways to implement tariffs, so the policy will continue. But it will be dogged at every turn by those who are opposed to it. That means tariffs will remain in the headlines, causing uncertainty for markets. The tariff saga wasn’t coming to an end, but it certainly seemed to be slowly progressing. Now countries that don’t wish to change the status quo will simply dig in a little deeper and hope that things remain as is.
If the president prevails in the Supreme Court, the tariff debate will end and the administration will continue to make new deals. If the Supreme Court sides with the lower courts, the administration will have to scramble for new ways to keep the tariff trade policy in place.
Keep in mind that one of the reasons the courts have found the use of IEEPA unlawful is that, while IEEPA does not mention tariffs, Congress has given some authorities to the president that explicitly do allow for tariffs. Trump has already used some of them (particularly Section 232 on aluminum, steel and autos), while he used others under his first administration.12 (He used Section 301 to impose tariffs on China and Section 201 to impose tariffs on solar panels here.13,14) There are other novel tools areas as well. Section 122 and Section 338 both allow for blanketed tariffs of 15% and up to 50%, respectively, although neither has been used in recent history.15,16
In other words, there are other tools available if tariffs are the ultimate destination. They aren’t as flexible, especially since many of these laws require specific investigations and public comment. But the president has other ways to implement new tariffs. The process is just going to get sloppier, if that’s even possible at this point.
Coming this week
- Monday and Tuesday will be quiet, with the market still mulling over the jobs report and its implications for the upcoming Fed meeting. Fed funds futures are predicting the Fed will cut rates by at least 25 basis points (.25%) with a 100% probability.17 There’s also an 11% probability of a cut of 50 basis points (0.50%).
- Inflation data will start on Wednesday with the Producer Price Index (PPI) and Core PPI. We’ll also get MBA mortgage applications and wholesale inventories on Wednesday.
- The second monthly inflation shoe will drop on Thursday with the Consumer Price Index (CPI) and Core CPI. We’ll also get weekly unemployment claims, which will be scrutinized much more closely given last week’s employment data.
- The week will end quietly with consumer sentiment, which hasn’t been worth highlighting lately.
Index Performance Returns % | |||||
| 1 WK | YTD | 1YR | 3YRS | 5YRS | |
| S&P 500 | 0.33% | 10.20% | 17.77% | 18.21% | 13.59% |
| NASDAQ | 1.14% | 12.37% | 26.70% | 23.11% | 13.91% |
| DJIA | -0.32% | 6.71% | 11.40% | 13.18% | 10.04% |
Interest Rates: | |||||
| 9/5/2025 | 8/29/2025 | ||||
| UST 10 YR Government Bond Yield | 4.08% | 4.23% | |||
| Germany 10 YR | 2.67% | 2.74% | |||
| Japan 10 YR | 1.58% | 1.64% | |||
| 30 YR Mortgage | 6.48% | 6.54% | |||
| Oil | $61.97/ppb | $64.68/ppb | |||
| Regular Gas | $3.20/ppg | $3.19/ppg | |||
| All data as of Sept. 5, 2025 | |||||
Sources:
1 CBS News. Sept. 1, 2025. “A federal appeals court ruled against Trump’s tariffs. Here’s what could happen next.” https://www.cbsnews.com/news/trump-tariffs-federal-appeals-court-rules-illegal-what-happens-next/. Accessed Sept. 7, 2025.
2 Filip Tomotija. The Hill. Sept. 6, 2025. “Zelensky on Putin’s Moscow invitation: ‘He can come to Kyiv.’” https://thehill.com/policy/international/5490035-zelensky-putin-moscow-kyiv-summit/. Accessed Sept. 7, 2025.
3 Yahoo! Finance “S&P 500 (ˆGSPC).” https://finance.yahoo.com/quote/%5EGSPC/. Accessed Sept. 7, 2025.
4 Yahoo! Finance. “NASDAQ Composite (ˆIXIC).” https://finance.yahoo.com/quote/%5EIXIC/. Accessed Sept. 7, 2025.
5 Yahoo! Finance. “Dow Jones Industrial Average (ˆDJI).” https://finance.yahoo.com/quote/%5EDJI/. Accessed Sept. 7, 2025.
6 U.S. Bureau of Labor Statistics. Sept. 5, 2025. “Employment Situation Summary.” https://www.bls.gov/news.release/empsit.nr0.htm. Accessed Sept. 7, 2025.
7 Natalie Sherman. BBC. Aug. 2, 2025. “Trump fires lead official on economic data as tariffs cause market drop.” https://www.bbc.com/news/articles/cvg3xrrzdr0o. Accessed Sept. 7, 2025.
8 Scott Horsley. NPR. Aug. 11, 2025. “Trump taps conservative economist to lead statistics agency.” https://www.npr.org/2025/08/11/nx-s1-5499537/trump-bls-ej-antoni. Accessed Sept. 7, 2025.
9 U.S. Bureau of Labor Statistics. Sept. 3, 2025. “Job Openings and Labor Turnover Summary.” https://www.bls.gov/news.release/jolts.nr0.htm. Accessed Sept. 7, 2025.
10 ADP Research. August 2025. “ADP® National Employment Report.” https://adpemploymentreport.com/. Accessed Sept. 7, 2025.
11 Erin Doherty. CNBC. Sept. 3, 2025. “Trump asks Supreme Court to quickly hear appeal to save his tariffs.” https://www.cnbc.com/2025/09/03/trump-tariffs-trade-supreme-court.html. Accessed Sept. 7, 2025.
12 U.S. Customs and Border Protection. “Section 232 Tariffs on Steel and Aluminum Frequently Asked Questions.” https://www.cbp.gov/trade/programs-administration/entry-summary/232-tariffs-aluminum-and-steel-faqs. Accessed Sept. 7, 2025.
13 Office of the United States Trade Representative. “China Section 301 – Tariff Actions and Exclusion Process.” https://ustr.gov/issue-areas/enforcement/section-301-investigations/tariff-actions. Accessed Sept. 7, 2025.
14 Office of the United States Trade Representative. “Section 201 – Imported Solar Cells and Modules.” https://ustr.gov/issue-areas/enforcement/section-201-investigations/investigation-no-ta-201-75-cspv-cells. Accessed Sept. 7, 2025.
15 Blake Harden. Retail Industry Leaders Association. June 5, 2025. “What is Section 122?” https://www.rila.org/blog/2025/06/what-is-section-122. Accessed Sept. 7, 2025.
16 Cornell Law School. “19 U.S. Code ŧ 1338 – Discrimination by foreign countries.” https://www.law.cornell.edu/uscode/text/19/1338. Accessed Sept. 7, 2025.
17 CME Group. “FedWatch.” https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html. Accessed Sept. 7, 2025.
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