To The Moon

For the week ending Fri, 20 Jun 2025, the US weekly jobless claims reported was released earlier due to Thursday’s Juneteenth public holiday. Let’s get the facts out of the way first before diving deeper. US Weekly Jobless Claims. For week ending 14 Jun 2025, initial weekly jobless claims fell by -5,000 to 245,000 from the previous week’s 250,000 claims (revised upwards by +2,000 claims), that had boosted claims to an 8th-month high. The 4-week moving average of claims (that strips out seasonal fluctuations from the data), increased +4,750 to 245,500 last week, the highest level since August 2023. Initial weekly claims stayed at levels consistent with: A further loss of labour market momentum in June 2025. Softening economic activity. According to economists, (minus some technical factors that accounted for elevation in claims) overall layoffs have risen in 2025 due to Trump's broad tariffs had created a challenging economic environment for businesses. US Continuing Jobless Claims. As mentioned in the past, I find the Continuing Claims the more “actual” reflection of US labour market. This is because it tracks long-term joblessness instead of weekly data that could swing wildly at times. For week ending 07 Jun 2025, continuing claims dropped -6,000 to a still-high seasonally adjusted 1.945 million, down from its previous week 1.951 million. Recently laid off workers are struggling to find work. Deep Dive. The current labour market appears strong on the surface, but actually, there are big problems lurking underneath. Unemployment May 2025. Unemployment is still low at 4.2% and wage growth is steady. And according to US Bureau of Labour Statistics (BLS), US added a relatively healthy 139,000 roles in May 2025. (see below) However, according to a new report, a growing number of Americans are “functionally unemployed” - a term that describes people who are not included in topline unemployment numbers, but are still struggling in the labour market. This includes people who are : Jobless and have stopped searching for work. Employed but earning an annual salary of less than $25,000 annually. According to The Ludwig Institute for Shared Economic Prosperity (LISEP) report, a nonprofit focused on economic and policy research: Around 24.3% of Americans currently fall under this category, That is up from around 22.3% - 2 years ago. According to LISEP Chair, Gene Ludwig - nearly 1-in-4 workers are functionally unemployed, with current trends showing little sign of improvement. The harsh reality is, many Americans continue to struggle to make ends meet. Without an influx of dependable, good-paying jobs, the economic opportunity gap will widen. Alternative metrics like “functional unemployment” might partially explain why so many workers are feeling down about the economy now. One recent report from Glassdoor (employment platform), found that employee confidence amongst entry-level workers has hit an all-time low. Traditional unemployment is still modest, but the labour market has cooled from where it was just a few years ago, and employees are looking warily at how (a) tariffs and (b) AI will affect their future job prospects. Ludwig added, amid an already uncertain economic outlook, the rise in functional unemployment is a concerning development. Vicious Cycle. A weak US economy indirectly affects the stock market because slower economic growth typically leads to reduced: Corporate earnings. Diminished consumer spending. Lower investor confidence. All of which can drive stock prices down. For example, in early 2025, negative GDP growth and concerns over rising tariffs and inflation contributed to market volatility and pressured valuations. The S&P 500 experienced sharp swings in response to policy uncertainty and economic data. Historically, most stocks are vulnerable to this cycle. However, large, diversified companies with strong global revenue streams and resilient business models have demonstrated a greater ability to weather economic downturns and avoid the worst effects of a weak domestic economy. This include mega cap companies like: $Apple(AAPL)$. $Alphabet(GOOG)$. $Microsoft(MSFT)$. Of the 3 recommendations, Microsoft is best of 3 companies, able to weather (i) sharp swings in the S&P 500 and (ii) negative 2025 US GDP growth. (see below) S&P 500 vs Microsoft - Past 6 months performances MSFT maintained a stronger performance, supported by its diversified business model and leadership in cloud computing and AI. While the S&P 500 index managed to chalk up a +0.84% gain for the past 6 months, MSFT fared better, coming in with a +10.0% gain. MSFT benefited from (a) robust enterprise demand and (b) recurring revenues from its software and cloud services, helping it avoid the worst effects of a weak domestic US economy and market volatility. This explains why MSFT has been forecasted to leapfrog $NVIDIA(NVDA)$ and become the #1 Artificial intelligence stock by 2026. click here ! for details. Repost to share ok. Thanks. Remember to check out my other posts. (See below). Help to Repost ok, Thanks. Must Read: Click on below titles to access. Repost to share, Like as encouragement ok. Thanks. TSLA falls becos Robotaxi failure to launch ? Fri, 20 June. Picked post. No Interest Cut : Here's 6 Winners & Losers ! Fri, 20 June. Picked post. Bad news will sink TESLA in H2 2025 ? Thu, 19 June. Picked post. Do you think MSFT is the best there is to offer on all things Artificial Intelligence (AI) ? Do you think MSFT will be one of the better performing Mag 7 by year end ? If you find this post interesting, give it wings! ️ Repost and share the insights ? Do consider “Follow me” and get firsthand read of my daily new post. Thank you. @Daily_Discussion @TigerPM @TigerStars @Tiger_SG @TigerEvents