The official jobs report comes out this Friday. Expectations are for another slowdown, with about 175,000 jobs added, down from 199,000 in December. With everything that is going on, especially the number of people who have the Omicron variant and are presumably not at work, that would be a great result. Unfortunately, the real number is likely to be well below that and will probably be negative—maybe significantly so.

Tensions between Russia and Ukraine are showing no signs of abating. The geopolitical implications of further escalation could be quite dire and complicated. Although the deadlock may be resolved through diplomacy, we are watching for the impact on asset prices if the conflict escalates. Energy and commodity markets could be in the immediate line of fire, but repercussions may also be felt in the region’s equity and fixed income markets. Finally, if the situation worsens, the ripple effects could be more broad-based and have an impact on global inflation expectations and monetary policy.

After a strong close to 2021, markets pulled back to start the year, with U.S. indices dropping between 3 and 10 percent. On the medical front, the Omicron wave continued. As case growth rose to new highs, consumer and business confidence took a hit. Finally, January reports showed inflation at a 40-year high, and the Fed announced a rate hike in March was very likely.

There were a number of important economic updates last week, with a focus on consumer confidence, the Fed’s January meeting, and the advanced estimate of fourth-quarter GDP growth. The first look at GDP growth in the fourth quarter was a highlight, as the report showed that the economic recovery picked up speed to finish out the year. This will be another busy week of updates, with reports on business confidence and January employment serving as highlights to come.

On February 1, China bids farewell to the Year of the Ox and rings in the Year of the Tiger. The ox symbolizes prosperity, diligence, and perseverance. In 2021, this symbol was apt, as Chinese economic policy shifted from “growth at all costs” to “common prosperity” and the country diligently persevered through many regulatory changes. Chinese equities were collateral damage in the process. As the Year of the Tiger rolls in, Chinese equities could remain volatile but purr stronger.

One of the key sources of uncertainty that has driven the market pullback over the past weeks has been interest rates. Specifically, the rise in rates—and the fear that the Fed would tighten further—pulled growth stocks down, including many in the tech sector, and generated significant uncertainty around where the economy was going.

I see the market is bouncing back a bit, and I know the headlines of the day will revolve around the Fed meeting and press conference, which are still a couple of hours away and I will cover tomorrow. So, let’s do something a bit different today. Let’s take a look at my 100K project.

Yesterday gave a great example of what I meant in Friday’s post when I said the stock market was not crashing. For those who missed it, the U.S. markets dropped sharply during the day, with the Nasdaq down almost 5 percent on the day, only to rebound at day’s end and land in the green. This kind of reversal is rare and signaled that—at the depths of the decline yesterday—a number of investors saw enough value in those prices to step in and buy.

Last week saw the release of a number of important economic updates, with a focus on the housing sector. The existing home sales report was a highlight, as sales of existing homes showed notable year-over-year growth in 2021. This week will be busy once again. The highlights to come include reports on consumer confidence, the results from the January FOMC meeting, and the first look at fourth-quarter GDP growth.

Yesterday, I got two emails requesting a response to the current market pullback. I received another couple of emails referring to a prediction (by a very well-known investor) that the stock market was now inevitably poised for a 50 percent decline. Clearly, the anxiety level is high, which makes sense given the multitude of worries and things that could go wrong. We have the Omicron wave, inflation, interest rates, a potential war in Ukraine, and on and on. Is this the end of days—again?