• The upcoming employment report could influence U.S. interest rates and the S&P 500's performance.
• Irish Prime Minister's early election decision results in a dead heat with Sinn Fein, impacting global markets.
• Symbotic's shares plunge due to discovered accounting errors, affecting the tech sector.
• These events, along with other factors, will continue to shape the global economic landscape in 2025.

The upcoming week is set to provide investors with a fresh perspective on the health of the U.S. economy, with the release of a closely watched employment report. This report could potentially determine the trajectory of interest rates in the months ahead. The S&P 500 is heading into December near record highs, following an over 25% year-to-date gain. This performance has been partly fueled by expectations that the Federal Reserve will continue cutting interest rates into next year, after reducing borrowing costs by 75 basis points in 2024.

However, uncertainty over the Fed's rate trajectory has increased in recent months due to robust economic data, including a blowout jobs report for September. This has stirred concerns that inflation could rebound if the central bank lowers rates too far, undoing two years of progress in tamping down prices. Investors have largely welcomed evidence of economic strength, but another round of strong jobs data on Dec. 6 could further erode expectations for Fed cuts and fuel wariness over inflation.

The jobs data is expected to provide a clearer picture of the underlying trend, which is important given the ongoing debate and uncertainty around the path for interest rates by the Fed. Wall Street has already tempered expectations for cuts over the coming year. Fed funds futures show investors betting the rate will fall to 3.8% by the end of next year, from its current 4.5% to 4.75% range. This is more than 100 points higher than what they had priced in September.

Global Political Impact on Markets

In other news, the Irish Prime Minister Simon Harris's Fine Gael party is locked in a virtual dead heat with Sinn Fein in the general election, suggesting his decision to go to the country early didn't yield the advantage he predicted. Fine Gael won 21% of first-preference votes in Friday's election, the official exit poll showed. Sinn Fein won 21.1%, while Fianna Fail, Fine Gael's coalition partner, was on 19.5.%. The poll had a margin of error of 1.4%.

Even so, Fine Gael and Fianna Fail going back into government is still the most likely outcome - both have ruled out working with Sinn Fein. But a tight race is not ideal for Harris, especially if he emerges with less support than his rival. The premier called the vote, which wasn't due to be held until March, after his party surged in opinion polls since he became Taoiseach in April. That, plus a large giveaway budget in October and a slide in support for Sinn Fein, made it seem like the optimal time to seek a new mandate.

Whoever forms the next government will do so at an opportune time, with Ireland enjoying a budget surplus that is rare among European nations and tax receipts expected to soar further. Management of Ireland's billions has been front and center in the campaign, with parties competing on promises to fix infrastructure and end a housing shortage.

Tech Sector and AI Developments

In the tech sector, shares of Symbotic (NASDAQ: SYM), which makes artificial intelligence (AI)-enabled robots for warehouses, plunged 35.9% on Wednesday on extremely heavy trading volume. Symbotic's stock began trading in June 2022, after the Boston area-based company went public via a reverse merger with a special purpose acquisition company (SPAC). Walmart is an investor in the company, as well as its largest customer.

Investor pessimism was fueled by the company's early Wednesday release of a statement saying that on Nov. 25 it had discovered accounting errors, in addition to the type that it disclosed on Nov. 18, while it was preparing its fiscal 2024 annual report filing on Form 10-K with the Securities and Exchange Commission (SEC). Fiscal 2024 ended on Sept. 28 for the company.

The accounting errors that Symbotic had disclosed on Nov. 18 when it reported its fiscal Q4 results were timing-related (between quarters within the fiscal year) and had no net impact on overall fiscal 2024 results, the company said at the time. But the newly discovered accounting errors -- which occurred in the initial Q2, Q3, and Q4 reports -- will negatively affect several key metrics in its fiscal 2024 results. Due to the new discovery, Symbotic is delaying filing its annual report with the SEC because it will be restating its fiscal 2024 results. Moreover, the newly found errors led management to lower its guidance for the first quarter of fiscal 2025.