Last Updated: 4:20 PM EST
Stock indices finished today’s trading session in the red. The Nasdaq 100 (NDX), the S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) fell 0.11%, 0.11%, and 0.22%, respectively. This comes after U.S. job growth experienced a sharp increase in May. In fact, employers added 272,000 jobs compared to April’s gain of over 165,000, which was way above the 182,000 jobs economists had anticipated. Interestingly, though, the unemployment rate increased to 4% from 3.9% in April.
This sparked some minor pessimism among investors because it could potentially sway the Federal Reserve to wait longer before cutting interest rates. Indeed, the market-implied probability of a rate cut in September decreased from 55% yesterday to 45% today, according to the CME FedWatch Tool.
In addition, the Atlanta Federal Reserve updated its latest GDPNow reading, which allows it to estimate GDP growth in real time. The “nowcast” becomes more accurate as more economic data is released throughout the quarter. Currently, it estimates that the economy will expand by about 3.1% in the second quarter.
This is higher than its previous estimate of 2.6%, which can be attributed to this morning’s employment situation release from the U.S. Bureau of Labor Statistics and this morning’s wholesale trade report from the U.S. Census Bureau.
First Published: 3:11 AM EST
U.S. futures traded higher on Friday morning as investors looked ahead to the Nonfarm Payrolls report for May, due for release today. Futures on the Nasdaq 100 (NDX), the S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) were up by about 0.15%, 0.11%, and 0.17%, respectively, at 2:32 a.m. EST, June 7.
All three major indices are likely to end the week in the green. The Nasdaq, the S&P 500, and the Dow Jones have gained 2.62%, 1.43%, and 0.52% so far this week. The rally came following signs of a cooling job market, which raised expectations of interest rate cuts later this year.
It should be noted that traders are awaiting today’s monthly jobs report for further insights into the condition of the labor market and the likely path of Federal Reserve monetary policy. Economists expect a 190,000 increase in jobs last month, along with a 3.9% year-over-year rise in wages.
In major stock market news, Lululemon (LULU) stock gained about 5% yesterday on better-than-expected fiscal first-quarter results. Further, Salesforce (CRM) rose 2.6% after its director, Mason Morfit, disclosed having bought shares of the company worth $99.8 million.
Meanwhile, the U.S. 10-year treasury yield was up at the time of writing, floating near 4.30%. At the same time, WTI crude oil futures trended higher, hovering near $75.65 per barrel as of the last check.
Elsewhere, European markets opened higher today following a strong trading session on Thursday. Positive investors’ sentiments were fueled by the 25 basis point interest rate cut announced by the European Central Bank yesterday.
Asia-Pacific Markets Traded Down on Friday
Most of the Asia-Pacific indices were trading lower today as investors evaluated a slew of economic data from China and Japan.
At the time of writing, Hong Kong’s Hang Seng index was down 0.64%. Further, Japan’s Nikkei and Topix indices declined by 0.05% and 0.08%, respectively. Also, China’s Shenzhen Component was down 0.82%, while the Shanghai Composite gained by 0.14%.
Interested in more economic insights? Tune in to our LIVE webinar.
