US Stock Indices Reach New Records as Weak Jobs Data Boosts Rate Cut Expectations; Intel Surges on Trump Meeting

US equity markets demonstrated strong momentum on January 9, 2026, with all major indices advancing to new highs or near-record levels. The S&P 500 achieved a closing record of 6,975.93, representing a 0.69% gain, while the NASDAQ Composite rose 0.89% to 23,706.30, positioning itself within striking distance of its all-time peak [0]. The Dow Jones Industrial Average added 0.58% to close at 49,521.43, approaching the significant 50,000 milestone, and the Russell 2000 small-cap index advanced 0.38% to 2,624.79 [0].

The market’s advance was fundamentally driven by the December 2025 jobs report, which revealed significant weakness in labor market conditions. The US economy added just 50,000 non-farm payroll positions during December, falling short of economist expectations of approximately 55,000 to 60,000 positions [2][3]. More concerning from a trend perspective, the three-month moving average has now turned negative, averaging approximately -22,000 jobs per month—a development that provides the Federal Reserve with potential “ammunition” to consider rate cuts later in 2026 [2].

According to Seema Shah, Chief Global Strategist at Principal Asset Management, “The picture remains far from clear: payroll growth undershot expectations, and downward revisions to prior months have pushed the three-month moving average into negative territory” [2]. This mixed data created an environment where equity investors interpreted the weakness as supportive of easier monetary policy, while bond market dynamics reflected evolving rate expectations.

The sector analysis revealed a notable rotation pattern, with economically sensitive sectors outperforming while defensive and commodity-linked areas lagged. Industrials led gains at +1.54%, followed by Real Estate at +1.42% and Basic Materials at +1.18% [0]. Technology stocks advanced 1.17%, significantly influenced by Intel’s exceptional rally, which lifted semiconductor equities broadly [0].

Conversely, the Energy sector declined 1.63%, the steepest drop among all sectors, followed by Financial Services at -0.69% and Healthcare at -0.49% [0]. This sector performance pattern suggests investors are positioning for a potential economic slowdown while simultaneously anticipating the beneficial effects of lower interest rates on rate-sensitive sectors like real estate.

Intel Corporation emerged as the day’s most notable individual mover, with shares surging 8.69% to close at $45.44 on volume of 147.92 million shares [0][4]. The stock reached an intraday high of approximately $45.53, representing a gain of nearly 9.78% as reported in the original event coverage [1]. This dramatic rally brings Intel to its highest price level in nearly two years and represents part of a broader recovery narrative that has seen the stock appreciate 93.47% over the past six months and 136.81% over the trailing twelve months [4].

The primary catalyst for Thursday’s surge was President Trump’s meeting with Intel CEO Lip-Bu Tan, which generated positive commentary from the administration. On Truth Social, Trump stated that “The United States government is proud to be a shareholder of Intel” while highlighting Intel’s domestically designed, built, and packaged chips [4][5]. This government endorsement carries particular significance given Intel’s strategic role in domestic semiconductor manufacturing and its participation in CHIPS Act funding initiatives.

Additional momentum came from Intel’s presence at CES 2026, where the company’s new Panther Lake (Core Ultra Series 3) processors received positive reception. Performance claims of approximately 77% improvement in gaming workloads and 60% improvement in multithreaded tasks have renewed confidence in Intel’s product execution capabilities [5]. The company has now “doubled” the value of the US government’s stake, transforming a previously underperforming investment into a significant gain for taxpayers [5].

From a technical perspective, Intel is trading well above its 50-day, 100-day, and 200-day moving averages, with the 100-day Relative Strength Index at 58—indicating the stock maintains room for further gains before reaching overbought territory [5]. However, the analyst consensus remains cautious, with a consensus rating of HOLD and price targets ranging from $20 to $52, with an average target of $39.00 below current levels [4]. The elevated P/E ratio of 1,033.89x reflects the market’s pricing of recovery expectations rather than current fundamental performance [4].

The December jobs report carries significant implications for monetary policy expectations. Despite the weaker payroll data, the unemployment rate’s decline to 4.4% from 4.5% created mixed signals for Fed decision-makers [2]. CME FedWatch data indicated the probability of a January rate cut dropped to just 5%, down from 14% earlier in the day, as the unemployment rate improvement reduced immediate pressure for monetary easing [2].

Federal Reserve officials have consistently signaled a “high bar” for rate cuts in 2026, and the data dependency of market positioning means upcoming commentary from Fed Chair Jerome Powell and other FOMC members will be crucial for calibrating expectations. According to analysts at Principal Asset Management, “slow, gradual cuts remain our base case for 2026” despite the diminished January cut probability [2].

Notably, some economists, including Fed Chair Powell, have expressed skepticism about Bureau of Labor Statistics payroll figures, with Powell estimating the economy has been losing approximately 20,000 jobs monthly since April [3]. If accurate, this would suggest the official data may be overestimating job growth and the labor market situation could be more challenging than headline numbers indicate.

The interconnection between labor market weakness, Federal Reserve policy expectations, and equity market momentum represents a complex dynamic that investors must navigate carefully. The equity market’s positive reaction to weaker jobs data reflects the dominant narrative that softer labor conditions will accelerate the timeline for rate cuts—traditionally a constructive factor for equity valuations, particularly in growth and technology sectors.

However, this interpretation contains an inherent tension: weaker employment data, if sustained, could signal an economic slowdown that eventually undermines corporate earnings growth. The three-month jobs average turning negative is particularly noteworthy from a historical perspective, as such trends have often preceded periods of economic contraction. Market participants are effectively betting that the Federal Reserve can engineer a “soft landing” while implementing rate cuts that support continued economic expansion.

Intel’s dramatic rally, amplified by the presidential meeting and CES 2026 reception, underscores the strategic importance of the semiconductor sector in current US industrial policy. The CHIPS Act’s focus on domestic semiconductor manufacturing has elevated Intel from merely a commercial enterprise to a matter of national technological competitiveness. The administration’s positive commentary and the doubling of the government’s stake value create a feedback loop where policy support and market performance reinforce each other.

The technical performance claims for Panther Lake processors suggest Intel may be regaining competitive ground against rivals AMD and NVIDIA, though sustained execution will be required to validate the turnaround narrative. The January 29, 2026 earnings report (Q4 FY2025, EPS estimate: $0.08) will serve as an important near-term catalyst for validating market expectations [4].

Several critical data points remain pending that could significantly influence market direction. The December Consumer Inflation Report (CPI) will provide additional context on the inflation backdrop and the Fed’s policy calculus. Further details on Trump administration industrial policy, including CHIPS Act implementation and tariff decisions, will directly impact semiconductor sector sentiment. Commentary from Fed officials in coming days will be essential for calibrating rate expectations, and the broader Q4 2025 earnings season will reveal the actual health of corporate America beyond macroeconomic indicators.

: The extreme P/E ratio of 1,033.89x indicates the stock is priced for perfection [4]. Any disappointment in the January 29 earnings report or subsequent quarters could trigger significant corrections. Analyst price targets averaging $39.00 below current levels suggest institutional skepticism about the sustainability of current prices [4].

: Intel’s manufacturing turnaround hinges on successful 14A process deployment in 2027 [5]. The semiconductor manufacturing industry is characterized by high capital intensity and technical complexity, and delays or yield problems could undermine the recovery narrative.

: If the three-month negative jobs average represents the beginning of a sustained downturn rather than a temporary blip, the resulting economic slowdown would impact corporate earnings across sectors. The disconnect between payroll data and Fed Chair Powell’s estimated “true” job loss of 20,000 monthly creates uncertainty about actual economic conditions [3].

: Market direction remains heavily tied to incoming economic data, creating elevated volatility potential around major releases. Fed officials have signaled resistance to early rate cuts, and any perception of policy divergence between markets and the Fed could generate friction.

: If Fed rate cuts materialize later in 2026 as expected, historically rate-sensitive sectors such as Real Estate, Utilities, and small-cap stocks could benefit from improved financing conditions and multiple expansion.

: Successful deployment of Panther Lake and subsequent processor generations could validate the turnaround narrative and attract institutional capital currently sitting on the sidelines despite the price appreciation.

: The current environment creates opportunities for tactical positioning around economic data releases, with labor market weakness potentially providing entry opportunities for long-term investors if the “soft landing” narrative proves accurate.

On January 9, 2026, US equity markets achieved record highs driven by the convergence of weaker-than-expected December jobs data and positive corporate developments at Intel Corporation. The S&P 500 closed at a record 6,975.93 (+0.69%), while the NASDAQ Composite advanced 0.89% to 23,706.30, approaching its all-time peak [0]. The December jobs report revealed only 50,000 positions added, with the three-month moving average turning negative at approximately -22,000 jobs—developments that reinforce expectations for Federal Reserve rate cuts later in 2026 despite near-term policy uncertainty [2][3].

Intel Corporation shares surged 8.69% to $45.44 following President Trump’s positive comments after meeting with CEO Lip-Bu Tan, with the stock now at its highest level in nearly two years [1][4]. The rally reflects renewed confidence in Intel’s turnaround prospects, supported by positive reception of Panther Lake processors at CES 2026 and government endorsement of the company’s strategic role in domestic semiconductor manufacturing [5].

Sector rotation favored economically sensitive areas, with Industrials (+1.54%), Real Estate (+1.42%), and Basic Materials (+1.18%) leading gains, while Energy (-1.63%) and Financial Services (-0.69%) lagged [0]. This pattern suggests investors are positioning for potential rate cuts while monitoring labor market developments carefully.

The analyst consensus on Intel remains HOLD with price targets ranging from $20 to $52, indicating institutional caution despite the strong price performance [4]. Upcoming catalysts include the December CPI report, Fed official commentary, Intel’s January 29 earnings report, and broader Q4 2025 corporate earnings season—all of which will influence market direction in the near term.