To The Moon

According to revised federal data, US economy experienced almost zero job growth in 2025.

Preliminary data had indicated that the US economy added 584,000 jobs last year.

However, US Bureau of Labour Statistics (BLS) revised that number after it received additional state data and found that the labour market had added only 181,000 jobs in all of 2025.

This is far fewer than the 1.46 million jobs that were added in 2024. (see below)

It will go down US jobs’ history as the worst year for hiring since 2020, or since 2003 outside of a recession.

Additionally, the BLS subtracted 862,000 jobs from March 2024 - March 2025, as part of its annual benchmark revisions.

Wednesday’s revisions also show that US labour market (in 2025) contracted for 4 months (January, June, August and October) instead of the previously reported 3 months, with June 2025, the new addition after taking into considerations the final benchmark revision.

The average revisions to US jobs data have been steeper in the years since 2020 than they were before the pandemic.

Economists and analysts largely attribute this to a shift in labour market dynamics and survey response rates.

The massive revisions down were not entirely unexpected, however. BLS previously projected a downward revision of 911,000 for 2024-2025.

Rubbing salt in the Wound.

It did not help that US central bank, Fed chair Jerome Powell has weigh-in on the payroll numbers - that was unavailable to them for both October & December 2025 FOMC meetings.

At post-FOMC press conference, Fed chair Jerome Powell has suspected that last year’s hiring numbers were likely too rosy.

Below were what he has said:

• “We think there’s an overstatement in these numbers by about 60,000, so that would be negative -20,000 per month.

• “I think you can say that US labour market has continued to cool gradually, maybe just a touch more gradually than we thought”.

Like it or not, this is one salient reason why US market continue to fall on Wednesday.

US Non farm payroll - 2023 to 2026

US Jobs - January 2026.

On a brighter note, hiring has picked up in the new year.

For January 2026, US Non-Farm payroll report (NFP) showed that hiring has increased by 130,000 jobs, above expectations of analysts polled by LSEG, who estimated the economy would add 70,000 jobs.

At the same time, revisions were made to payroll numbers for prior 2 months:

• November 2025 job numbers were marked down by -15,000, from a gain of 56,000 to 41,000.

• December 2025's gains were revised down by -2,000 from a gain of 50,000 to 48,000.

According to BLS, the following sectors registered job gains:

• Health care. Added 81,900 jobs in January; where gains were above its monthly average of 33,000 jobs added per month in 2025.

• Social assistance.

• Construction. Added 33,000 jobs in January; where it was essentially flat in 2025.

At the same time, job losses were in:

• Federal government. For January, it declined by -42,000 jobs, with job cuts at the federal (-34,000) and state (-18,000) level, partially offset by a gain among local governments (+10,000).

• Financial activities.

Political Ripple Effect.

Voter confidence in the economy has reached a new low, with recent polls showing a steady decline in the president’s approval rating and deep-seated anxiety regarding the job market.

The growing public pessimism was further compounded by January 2026 NFP report.

The latest numbers significantly complicate Trump & the Republican party's strategy as they struggle to build a winning economic narrative ahead of November 2026 midterm elections.

US Manufacturing.

Manufacturing, a key industry targeted for growth by Trump, was among the industries that saw “little change” in January 2026.

Still, factory jobs rose 5,000 in the month, for their first increase since January 2024. Analysts expected a contraction.

Health care sector was the largest contributor to job gains in January, adding a net 137,000 jobs. Over the course of 2025, it has been the driving force behind job gains.

The Leisure & Hospitality sector added only 1,000 jobs in January, which many economists have described in recent months as something that would be a red flag, given how reliant the industry is on consumer spending.

Unemployment.

The other piece of good news out of January 2026 NFP report is US unemployment rate.

It has fallen marginally by -0.1% to 4.3% vs 4.4% consensus and 4.4% prior. (see above)

Under Biden administration, US unemployment peaked at 4.3% in July 2024.

Thereafter, it began to taper but it reversed in January 2025, marking the start of a year-long climb under the Trump administration.

US Market Fell - Other reasons.

Apart from BLS annual "benchmark revision" that was the key catalyst, below are 2 other reasons.

(1) Repricing of Interest Rate Cuts

The main reason for the market's drop was the immediate shift in expectations for US Fed policy.

The "March Cut" Evaporated:

• Prior to US NFP, many traders were betting on an interest rate cut in March 2026.

• After the strong job data and unemployment rate's dipping to 4.3%, the probability of a March cut plummeted to near zero.  

Delay to Summer:

• Market participants pushed back the timeline for the first rate cut from June to July.

• As markets are forward-looking, the prospect of "higher for longer" rates weighed heavily on valuations.

Latest CME FedWatch data confirms market expectations that interest rates will remain status quo, for the upcoming Mar 17-18, FOMC meeting. (see below)

• Prior to Wednesday’s US Non-farm report release, probability of a -0.25% interest cut was 15%; after the report was out, it fell to 8%.

• Latest probability of interest rate remaining unchanged in March is 92%, up from Tue, 10 Feb 2026’s 85% and a week ago’s 90.6%.

• Markets saw data affirming "steady Fed" path (possible pause), reducing liquidity hopes amid fragile jobs picture.

US treasury yields as of 12 Feb 2026

(2) Treasury Yield Surge.

Investors’ "flight to quality" over the past few trading sessions have led to increase demand for bond, driving up prices inevitably. (see below)

US 10-year treasury yield:

• Rose by +0.08% to 4.36% intraday (highest since Dec 2025), as strong headline signaled no Fed rush to cut.

• Higher yields crushed equity multiples, hitting Nasdaq (-1.1%) and tech hardest.

• Its ascension was also due to January job growth that was more than double what Wall Street economists had expected.

US 2-year treasury yield surge no more than +0.05% to 3.512%, reflecting reduced expectations for Fed interest rate reductions the rest of 2026.

US 30-year treasury yield rose more than +0.02% to 4.814%.

US Market So Far.

On Thu, 12 Feb 2026 US market continued with its bloodbath consolidation, instead of staging a recovery. (see above)

By the time market called it a day:

• DJIA: -1.34% (-669.42 to 49,451.98).

• S&P 500: -1.57% (-108.71 to 6,832.76). Fell for its 2nd straight loss, erasing most of the index's bounce-back from last week's drubbing. It posted 99 new 52-week highs and 32 new lows.

• Nasdaq: -2.03% (-469.32 to 22,597.15).

On the NYSE, declining issues outnumbered advancers by a 2.17-to-1 ratio; with 748 new highs and 229 new lows.

On the Nasdaq, 1,305 stocks rose and 3,581 fell as declining issues outnumbered advancers by a 2.74-to-1 ratio.

On US exchanges, 22.45 billion shares changed hands compared with the 20.78 billion average from the last 20 sessions, clearly indicating extreme volatility.

With US Dept of Homeland Security facing a looming shutdown that will commence on Sat, 14 Feb 2026, this should act as a dampener to US market as it heads toward the final trading day of the week.

Where To Invest ?

In the wake of the volatile trading sessions that have plaqued US stock market for a while now, major financial houses like $Morgan Stanley(MS)$, $JPMorgan Chase(JPM)$ and Fidelity have shifted their focus toward "Quality" and "Defensive" sectors.

The top 3 sectors that come highly “recommended” are:

• Healthcare.

• Consumer staples.

• Utilities.

Drilled Down Recommendations.

Within the premier “safe havens” are further drill-down financial products that retail investors (like me) can consider.

Healthcare.

Healthcare leads defensive plays due to steady demand for essentials like pharmaceuticals and medical devices, with low sensitivity to economic swings.

Latest NFP report has ‘indirectly’ attested to that as it is one of few sectors that have actively added jobs in US labour market.

The one common denominator ‘repeatedly’ mentioned by funds houses is $Health Care Select Sector SPDR Fund(XLV)$

This is the gold standard for defensive healthcare exposure.

As of early 2026, it offers a diversified cushion against volatility by holding mega-cap pharma and managed care companies that possess "inelastic demand", ie. consumers cannot skip life-saving treatments regardless of the economy.

ETF’s Top 10 Holdings.

Its top 10 holdings read like a list of whose who in the Healthcare sector. (see above)

These ten healthcare giants represent the dominant "mega-cap" leaders in the sector, collectively providing diversified exposure across high-growth pharmaceuticals, medical technology, and managed care.

Led by Eli Lilly (14.5% weight) through Intuitive Surgical (3.2%), they represent dominant healthcare players spanning:

• Pharma (Eli Lilly, JNJ, AbbVie, Amgen).

• MedTech / devices (Merck, Thermo Fisher, Abbott, Gilead).

Collectively they have a strong forward P/Es averaging ~22x and market values over $2 trillion combined as of February 2026.

XLV - Profile Analysis.

This ETF’s pluses includes (a) low expense ratio at 0.09% and (b) high liquidity.

Its 2025 performance has been muted, leaving it with more attractive valuation multiples ($P/E$) than the broader S&P 500 heading into this volatile period.

ETF tracks stable giants like (1) Johnson & Johnson where its Q4 2025 results has led S&P sectors with broad gains, (2) Eli Lilly that contributed 39% to EFT’s value, but overall undervalued entering 2026 as per Morningstar analysis.

More importantly, it offers an ultra-low 0.08% expense ratio and deep liquidity with $41.7 billion in assets, ensuring minimal costs and instant exit capability during market panics.

XLV’s current price-to-earnings ratio (17.4x) is a significant discount to the S&P 500's 29.8x, offering a valuation cushion after the sector's relatively flat 2025 performance.

With a beta of 0.63, XLV historically fluctuates 37% less than the broader market, making it a statistically proven lower-risk vehicle for navigating current volatility.

XLV is currently characterized by low volatility and high quality metrics relative to its category. This positioning makes it a premier "defensive" choice for investors to divest the erratic price swings in US market, caused by recent January payroll report.

I plan to use this time to review how much to hold in stocks vs ETFs. With an evolving market, periodic portfolio assessment becomes a necessity. Do you agree ?

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• Do you think US market will continue to be volatile in the next few weeks ’?

• Do you think XLV is a wise alternative to healthcare stocks ( $UnitedHealth(UNH)$ or $Johnson & Johnson(JNJ)$) investment ?

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