The Fed’s December rate hike probability is nearing 80%! Are global stock markets facing another major test?

The U.S. labor market suddenly gained momentum, putting global investors on edge.
On November 6, the U.S. released October nonfarm payroll data, showing 165k jobs added, far exceeding market expectations of 65k. The unemployment rate fell to 4.1%, while average hourly earnings rose 0.4% month over month.
The data prompted markets to reassess the Fed’s policy path.
Currently, the market-implied probability of a 25-basis-point rate hike in December has risen to 77.7%.
Why are stock markets getting nervous?
Because interest rates are an important factor affecting stock valuations. Rising rates could mean higher borrowing costs for businesses and lower discounted values for future cash flows.
Technology and growth stocks, in particular, tend to be more sensitive to interest rate expectations.
However, the other side should not be overlooked: strong employment generally provides some support for household income and spending power, which could also help companies maintain earnings.
So, rate hike expectations do not necessarily mean stocks will fall.
What really matters is whether the pressure from rising rates will outweigh the benefits of economic growth.
The upcoming inflation data will be an important guide for markets.
#Gate股票畅聊季