Non-farm payroll data shows 64,000 new jobs, better than expected, but the unemployment rate unexpectedly rose to 4.6%, hitting a four-year high, and October non-farm figures were sharply revised downward to a decrease of 105,000. The “weak inside strong” non-farm data triggered asset revaluation, with US stocks closing lower for three consecutive days, WTI crude oil plummeting to $54.98, while Bitcoin stabilized and rebounded above $87,000 after intense selling, becoming the only asset defying the trend.
Contradictory Interpretation of Non-Farm Data: Why Good News Triggers Bad Reactions
(Source: Trading Economics)
Understanding the impact of non-farm data on the market requires a deep interpretation of the contradictions behind the figures. On the surface, the November non-farm employment increase of 64,000 surpasses market expectations of 45,000, indicating a rebound in the labor market after a significant decline in October. However, deeper data reveal clear signals that the US labor market is cooling. First, the October non-farm employment was confirmed to have decreased by 105,000, meaning the previous optimistic assessment of the labor market was overly so.
More critically, the November unemployment rate rose to 4.6%, not only higher than the expected 4.5% but also reaching a four-year high. Nick Timiraos, the “Fed mouthpiece,” pointed out that as of November, the private sector had added an average of only 44,000 jobs over the past six months, the slowest pace of hiring in the post-reopening cycle of the pandemic. Unrounded data show the unemployment rate increased from 4.440% in September to 4.573% in November, a rise of 13 basis points.
Gina Bolvin, President of Bolvin Wealth Management Group, stated: “This set of non-farm data depicts an economy that is ‘catching its breath.’ Employment is still growing, but cracks are appearing, providing the Fed with room to adjust policies without triggering market panic.” This assessment accurately captures the subtlety of the non-farm data—neither so strong as to force the Fed to turn hawkish nor so weak as to trigger recession fears.
According to CME Group’s FedWatch tool, after the non-farm report, the market’s probability of rate cuts in January remains around 24%, indicating that this report has not significantly altered the Fed’s short-term policy path. Fed Chair Powell stated last week that the central bank believes its policy settings will bring the unemployment rate to a stable level or “only increase by 0.1 or 0.2 percentage points.” However, the current rise in unemployment is approaching this tolerance limit, leaving a question mark over the Fed’s policy in 2025.
Bitcoin Stabilizes Against the Trend: The Only Winner After Non-Farm
(Source: CMC)
Amid the asset revaluation triggered by the non-farm data, Bitcoin has become the only major asset class to rise against the trend. After a sharp sell-off on Monday, Bitcoin showed signs of stabilization on Tuesday, rebounding above $87,000, about 3% higher than the overnight low. This performance contrasts sharply with the general weakness in US stocks, oil, and the dollar.
Bitcoin’s rebound after the non-farm data release is not coincidental. First, the “weak inside strong” feature of the data reduces the risk of the Fed turning hawkish in the near term, providing risk assets with some breathing room. Second, the rising unemployment rate enhances market expectations that the Fed will eventually be forced to cut rates, supporting rate-sensitive assets like Bitcoin. Third, amid widespread pressure on traditional assets, funds are seeking new allocation directions, and Bitcoin, as an alternative asset with low correlation to traditional markets, has attracted some inflows.
Some mainstream altcoins performed even more strongly, with BNB, XRP, and SUI rising between 3% and 6%. Crypto-related stocks also rebounded, with Strategy and Robinhood up 3% to 4%, and stablecoin issuer Circle’s stock soaring 9%. This broad rebound indicates that market confidence in the crypto ecosystem is recovering, not just Bitcoin.
However, market participants remain cautious about the short-term trend of crypto assets. Samer Hasn, senior analyst at XS.com, warned that Bitcoin’s current rebound may be merely a technical correction, and without clear macroeconomic catalysts, there is a possibility of retesting below $80,000. This cautious attitude reminds investors that although the non-farm data provides short-term support, a true trend reversal for Bitcoin still requires more catalysts.
Three Major Traditional Assets Decline Simultaneously: Chain Reaction After Non-Farm
US stocks continued to profit-take from high-valuation tech stocks after the non-farm data release. Previously leading AI-related stocks like Broadcom, Oracle, and Microsoft generally declined, with some investor funds shifting to defensive sectors such as healthcare and utilities. Eric Diton, President and CIO of The Wealth Alliance, said that the adjustment in AI stocks is a normal phenomenon, “This does not mean AI trading is over, but rather a necessary cooling-off process. The market is becoming more balanced, not disorderly.”
The plunge in oil markets is even more notable. US WTI crude fell below $55 per barrel, hitting a low of $54.98, the lowest since early 2021; Brent crude also declined to around $58. Since the beginning of the year, WTI has fallen approximately 23%, its worst annual performance since 2018. The oil market is under pressure from both rapidly increasing supply and declining geopolitical risk premiums. OPEC+ has accelerated production after years of cuts, while markets are beginning to price in the easing of the Russia-Ukraine conflict. Jorge Leon, head of geopolitical analysis at Rystad Energy, noted that if sanctions are lifted, about 170 million barrels of Russian “floating stock” could re-enter the market, further exacerbating oversupply.
The dollar weakened slightly after the non-farm data, falling to around 98, marking a second consecutive day of decline. Analysts pointed out that the data was not strong enough to overturn the market’s medium-term expectations of rate cuts, but the rising unemployment rate also keeps the Fed cautious in the short term. John Velis, strategist at BNY Mellon, said that the non-farm employment data is “mixed,” and the rising unemployment rate could draw Fed attention in January.
Asset Revaluation List Triggered by Non-Farm Data
US Stocks: S&P 500 down 0.5%, Nasdaq down 0.2%, Dow down 276 points (0.5%), profit-taking in AI sector
Oil: WTI drops below $55 to $54.98, hitting a new low since early 2021, down 23% year-to-date
Dollar: US dollar index slightly declines to around 98, second consecutive day of decline
Energy Stocks: ExxonMobil and Chevron both down about 2%, ConocoPhillips and Marathon Oil also weaken
Defensive Sectors: Healthcare and utilities attract capital inflows, market rotation intensifies
On the same day, US Commerce Department data showed September retail sales were flat month-over-month, below expectations of 0.1% growth; excluding autos, retail sales increased by 0.4%, beating the expected 0.2%, indicating consumer spending remains resilient. Additionally, the December preliminary S&P Global Manufacturing PMI registered at 51.8, the lowest in five months; services PMI was 52.9, the lowest in six months. These data further confirm the economic cooling trend revealed by the non-farm report.
Overall, the non-farm data has not fundamentally changed market direction but has intensified divergence among multiple assets. Against the backdrop of signs of economic slowdown, uncertain policy outlook, and changing geopolitical risks, investors are shifting from single-theme trading to more structured and defensive allocation strategies. In the coming days, inflation data, central bank decisions, and geopolitical developments will be key variables influencing market sentiment.
