Today’s Challenger employment report showed a surge in layoffs, which suggests that the fine balance of “no hiring, no firing” might be tipping over for the worse. This should keep yields under pressure and maintain the disinflationary environment that is supporting equities.

“October’s pace of job cutting was much higher than average for the month. Some industries are correcting after the hiring boom of the pandemic, but this comes as AI adoption, softening consumer and corporate spending, and rising costs drive belt-tightening and hiring freezes. Those laid off now are finding it harder to quickly secure new roles, which could further loosen the labor market,” said Andy Challenger, workplace expert and chief revenue officer for Challenger, Gray & Christmas.