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LAST WEEK IN REVIEW
Labor Market Deteriorates: Hiring Freezes and Layoffs Mount Multiple data points signaled a sharp cooling in employment: ADP reported only 22,000 private job additions (missing the 45,000 estimate), job openings (JOLTS) fell to their lowest level since 2020, and announced layoffs for January hit their highest level since 2009. The labor market has shifted from "low hire, low fire" to "low hire, high fire"; with hiring plans at their lowest recorded level since 2009, workers losing jobs now face a much harder environment to find re-employment.
AI Fears Wipe $830 Billion from Software Stocks A broad sell-off in software and services stocks erased nearly $1 trillion in market value as investors fear that new AI tools—specifically large language models moving into the "application layer"—pose an existential threat to traditional software business models.
Strategic Stockpile: 'Project Vault' Launched The administration unveiled a $12 billion initiative to stockpile critical minerals like cobalt and gallium, utilizing Ex-Im Bank loans to reduce reliance on Chinese supply chains.
Bitcoin Plunges, Then Rebounds Amid Volatility Bitcoin fell 13% in a single day—its steepest drop since the FTX collapse—before rebounding to $70,000, driven by fears of overextended ETF holders and fatigue among crypto-native investors.
Government Shutdown Ends President Trump signed a funding deal to end a four-day partial government shutdown, authorizing spending for key departments through September 30, though Homeland Security funding is only extended until February 13.
YOUR WEEKLY FORECAST
Tuesday, February 10
Data:
- Retail Sales
- Employment Cost Index (ECI)
- Import & Export Prices
The Advisor's Take: We start the week with a dual look at the consumer's health.
The Spending Power: Retail Sales measures actual spending at registers. A strong number suggests the "Soft Landing" is intact, benefiting discretionary stocks ($XLY ( ▼ 0.37% )). A miss here raises recession flags.
The Fed's Favorite: Do not sleep on the Employment Cost Index (ECI). While less famous than the jobs report, the Fed prefers this metric for tracking wage inflation because it accounts for benefits, not just salary. If ECI spikes, it signals that labor costs are becoming "sticky," which is historically a green light for bond bears to sell Treasuries ($TLT ( ▼ 0.02% )), driving yields higher.
Wednesday, February 11
Data:
- Nonfarm Payrolls (The Jobs Report)
- Unemployment Rate
- Average Hourly Earnings
- EIA Crude Oil Inventories
The Advisor's Take: The Jobs Report lands on a Wednesday.
The "Goldilocks" Zone: The market ($SPY ( ▲ 0.48% )) is praying for a balance: steady job growth (150k-200k range) with cooling wage growth.
The Danger Zone: If Average Hourly Earnings accelerate alongside a hot payroll number, it confirms the economy is running too hot for rate cuts. Conversely, a spike in the Unemployment Rate would spook markets about a potential recession.
Energy Check: Amidst the labor noise, EIA Oil Inventories will drop. If the jobs number is strong (implying high economic activity), a draw in oil stocks could ignite a rally in the energy sector ($XLE ( ▲ 0.73% )).
Thursday, February 12
Data:
- Producer Price Index (PPI)
- Initial & Continuing Claims
- Existing Home Sales
The Advisor's Take: Thursday acts as the prelude to Friday's CPI finale.
Wholesale Inflation: PPI measures inflation at the factory door. It is a leading indicator; if producers are paying more today, consumers will pay more tomorrow. A hot PPI often leads to a sell-off in tech ($QQQ ( ▲ 0.77% )) as traders front-run the risk of a hot CPI.
Housing Reality: Existing Home Sales will show if the recent moves in mortgage rates have frozen the secondary market. Low inventory plus low sales equals a stagnant market, which hurts home improvement retailers ($HD ( ▼ 1.08% ), $LOW ( ▼ 0.54% )).
Friday, February 13
Data:
- Consumer Price Index (CPI)
The Advisor's Take: The week culminates with the "Super Bowl" of inflation data.
The Trade: Volatility will be extreme. If Core CPI comes in "cool" (unexpectedly low), it could trigger a massive relief rally across all asset classes as the market prices in aggressive Fed rate cuts. However, if CPI is "hot," expect the week's gains to evaporate instantly as the "Higher for Longer" rate narrative takes total control.
HALAL STOCK SPOTLIGHT*
All stocks are screened for sharia-compliance on Zoya. We also exclude companies in the following three databases: WhoProfits.org, The Official BDS Targets, The American Friends Service Committee Database
ON Semiconductor Corporation ($ON ( ▼ 0.15% ))
The Business Model ON Semiconductor generates revenue by designing and manufacturing intelligent power and sensing solutions, including silicon carbide (SiC) power modules and analog/mixed-signal integrated circuits, primarily serving the automotive and industrial end-markets.
The Bull Case Bulls argue that the company's "Fab Right" manufacturing efficiency strategy and the strategic exit from low-margin legacy products will drive structural margin expansion, supported by a robust $6 billion share repurchase authorization that signals management confidence. Optimism is further bolstered by deepening partnerships—such as the expansion with FORVIA HELLA and Teledyne—which validate the company's leadership in high-growth silicon carbide (SiC) and analog platforms for electric vehicles and AI infrastructure.
The Bear Case Risks include the company's recent removal from the NASDAQ-100 Index, which may reduce institutional holding levels and trading liquidity, alongside exposure to cyclical headwinds in the automotive sector where regional demand can be volatile. Bears also caution that persistent manufacturing underutilization and the revenue drag from exiting legacy businesses could weigh on near-term growth and complicate the path to hitting mid-term profitability targets.
*Please read the disclaimer at the end of this email before forming any opinions on the stock.
MONEY TALKS
The "Halal" S&P 500 That Doesn't Exist (Yet)
Index investing is the Holy Grail of modern finance: low cost, broad diversification, and hard to beat. But for the Muslim investor, buying the S&P 500 (via SPY or VOO) presents a moral dilemma.
To get the returns of the market, you are forced to own everything in the basket—including the ~20-30% of companies involved in conventional banking, defense contracting, alcohol, and gambling. You are essentially "indexing" your way into impermissible income.
The solution is not a generic Halal ETF with high fees. The solution is Direct Indexing.
Think of it as "unbundling" the ETF. Instead of buying one share of a fund that holds 500 companies, you use technology to buy the individual shares of the 350+ companies that pass Sharia screening.
Why is this a power move?
Surgical Precision: You get the broad exposure of the US economy without a single penny going into a bank or casino. It is a "Personalized S&P."
Tax-Loss Harvesting on Steroids: An ETF only trades when you sell the whole thing. With Direct Indexing, if Coca-Cola is up but Tesla is down, you can sell the loser to harvest a tax loss (offsetting other gains) while keeping the rest of your portfolio intact. This "tax alpha" can add significant percentage points to your after-tax returns over time.
No "Fund Drag": You aren't paying an expense ratio to a fund manager to sit on the shares. You own them.
In today’s world, who you know is becoming more important than what you know. Join the largest online community of Muslim professionals in North America at muslimprofessionals.us.
That's all for this week. Make it a great one.
IMPORTANT LEGAL DISCLAIMER*
Please read this disclaimer carefully before proceeding. By reading and using the information provided in this newsletter, you acknowledge and agree to the terms outlined below.
1. Not Financial or Investment Advice The content provided in this newsletter, including all articles, market analysis, economic news, stock picks, trading plans (including entry prices, stop losses, price targets), catalysts, and risk assessments, is for educational and informational purposes only. It should not be construed as financial, investment, tax, legal, or any other form of professional advice. No fiduciary relationship is created by your subscription to or use of this newsletter.
2. Consult a Professional Advisor The author(s) and publisher of this newsletter are not licensed financial advisors, registered investment advisers, or broker-dealers. You should not make any investment decision based solely on the information presented here. It is imperative that you consult with a qualified and licensed financial professional to determine if a particular investment or strategy is suitable for your individual financial situation, risk tolerance, and investment objectives.
3. Inherent Risk of Investing All forms of investing carry significant risk. The stock market is volatile, and you may lose some or all of your invested capital. There is no guarantee that any of the strategies or stock picks discussed will be profitable. Past performance is not indicative of future results. Never invest money that you cannot afford to lose.
4. No Guarantee of Accuracy or Completeness While we strive to provide accurate and up-to-date information, we make no representation or warranty of any kind, express or implied, regarding the accuracy, adequacy, validity, reliability, availability, or completeness of any information in this newsletter. We are not liable for any errors, omissions, or for the results obtained from the use of this information. All information is provided on an "as-is" basis.
5. Disclaimer on "Halal" and Shariah Compliance The term "halal stock picks" refers to securities that have been screened against certain publicly available, third-party Shariah-compliance criteria at the time of publication. These standards can vary among different scholars, organizations, and screening services. The Shariah-compliant status of a company can change over time. We make no guarantee or warranty as to the Shariah-compliant status of any security mentioned. It is your sole responsibility to conduct your own due diligence and consult with your own qualified religious scholar to determine if an investment aligns with your personal Islamic principles.
6. Separation from Muslim Professionals of the Americas This newsletter is an independent publication. The views, thoughts, and opinions expressed herein belong solely to the author(s) of the newsletter and do not represent the views, policies, or official positions of the nonprofit organization Muslim Professionals of the Americas, its board of directors, officers, or members. Muslim Professionals of the Americas is a separate legal entity and assumes absolutely no liability or responsibility for the content of this newsletter, any financial losses, or any other damages incurred from its use.
7. Personal Holdings The author(s) of this newsletter may, from time to time, hold positions in the securities mentioned herein. The presentation of any stock is not a solicitation or direct recommendation to buy or sell that security.
