Trump’s Planned Shake-Up at BLS Raises Questions Over Economic Data, Risking Volatility in Financial and Industrial Stocks

President Trump has posted a new announcement on Truth Social, the social media platform. He wrote:

“For many years, the Bureau of Labor Statistics, under WEAK and STUPID people, has been FAILING American Businesses, Policymakers, and Families by releasing VERY inaccurate numbers. That is why I FIRED the former Commissioner, and am pleased to nominate the very talented Brett Matsumoto as the next Commissioner of the Bureau of Labor Statistics (BLS). Brett was a Supervisory Research Economist for the BLS, but is now serving as a Senior Economist on the Trump Council of Economic Advisers, like he did in my First Term. I am confident that Brett has the expertise to QUICKLY fix the long history of issues at the BLS on behalf of the American People. Brett Matsumoto is a Brilliant, Reputable, and Trusted Economist who will restore GREATNESS to the Bureau of Labor Statistics. Congratulations Brett!”

How Will Trump’s Statement Affect the Stock Market?

This latest post has the potential to affect the stock market. That’s because Trump’s attack on BLS credibility and promise of ‘fixing’ data could initially raise volatility across financials and industrials as investors reassess the reliability of key economic indicators that drive rate expectations and corporate planning, impacting broad sector ETFs like XLF, XLI, VIS, and IYJ. If markets interpret the Matsumoto nomination as leading to looser or more politically influenced labor data, banks and financials (JPM, KRE, VFH, XLF) might move on shifting views of future Fed policy and credit conditions, while payroll processors (ADP, PAYX) could see modest sentiment support as demand for private labor data and analytics rises. Industrials-focused ETFs (XLI, VIS, IYJ) may react to any perceived change in the quality or direction of economic data that drives capital spending and hiring, with positioning adjusting as investors judge whether revised statistics will signal stronger or weaker underlying growth.

Here are some of the stocks that might be affected:
Automatic Data Processing ((ADP)),
JPMorgan Chase & Co. ((JPM)),
Paychex ((PAYX)),
Vanguard Industrials ETF ((VIS)),
Financial Select Sector SPDR Fund ((XLF)),
Industrial Select Sector SPDR Fund ((XLI)),
SPDR S&P Regional Banking ETF ((KRE)),
Vanguard Financials ETF ((VFH)),
iShares U.S. Industrials ETF ((IYJ)).