Market Minute: December 3rd, 2025 - When Bad News Becomes Good News
It has been a little busy at Innovative Asset Advisors Group as we are busy onboarding new advisors and many new clients. There will be more to come on both of these topics. Being busy, I haven’t been able to pen a market Minute in about a week, but today’s news was too important to let go by without a comment.
Market Snapshot (as of Dec. 3, 2:30 PM)
As I write this on December 3rd at 2:30 PM, the equity markets are up, led by Small Caps (Russell 2000 +1.5%). The more value-oriented names in the Dow have that index up (+0.9%), compared to the S&P 500 (+0.4%) and the tech-heavy Nasdaq (+0.3%).
So, what gives? The government shutdown caused a significant delay in releases around the employment market, leaving market pundits starving for information to help them gauge the Fed’s next move. This morning, ADP released their private payroll statistics showing that private payrolls declined by 32,000 jobs in November. This is interesting because the expectation was for 40,000 new jobs to have been created.
When Bad News Is Good News
Sometimes bad news is good news for the stock market, and the ADP release is one of those cases. Because the Fed has been discussing the state of the employment market, this decline is concrete evidence of slippage. As a result, market prognosticators believe the Fed is now more likely to cut rates in December to bolster the economy and support the job market.
Looking Toward the Fed
Most economists believe the Fed will cut rates in December, and we have no reason to believe the Fed won’t deliver. That said, if the Fed doesn’t cut rates, the stock market will almost certainly be volatile to the downside. Interestingly, the bond market saw the 10-year Treasury decline by 3 basis points on the same news, so it appears that the bond market may have already priced in a rate cut.
Our challenge, as always, is determining when good news is good news, when good news is bad news, when bad news is good news, when bad news is bad news, and when news is just… news.
Stay tuned.
Disclaimer: Investment advisory services offered through Innovative Asset Advisors Group, LLC, (“IAAG”), a Registered Investment Advisor with the U.S. Securities and Exchange Commission. Registration does not imply any level of skill or training. The content provided is for informational purposes only and does not constitute investment, legal, or tax advice. Investments, including equities, bonds, commodities, real estate, and alternative assets, carry risks, including the potential loss of principal. Past performance is not indicative of future results. Before making any financial decisions, you should consult with your personal financial, legal, or tax advisor to evaluate your individual circumstances. IAAG does not guarantee the accuracy, completeness, or timeliness of the information presented, and it may be subject to change without notice. This material, or any portion thereof, may not be reprinted, sold, or redistributed without the written consent of Innovative Asset Advisors Group, LLC.
