Positive Job Report Calms Economic Concerns
Wall Street closed higher on Friday, as a better-than-expected jobs report eased concerns about the economy. Tesla also rebounded, recovering from some of its steep losses from the previous session’s sharp decline.
The S&P 500 rose by 1.03% to 6,000.36 points. The Nasdaq Composite, heavily weighted towards technology stocks, gained 1.20% to reach 19,529.95 units. The Dow Jones Industrial Average advanced 1.05% to 42,762.87 points.
All eleven sectors of the S&P 500 closed in positive territory, led by energy, communication services, and consumer discretionary sectors. Consumer staples lagged behind with a mere 0.2% increase.
Over the week, the S&P 500 increased by 1.03%, Dow Jones gained 1.17%, and Nasdaq rose by 2.18%.
Tech Stocks Continue to Rise
Tech stocks continued their upward trend as investors welcomed the news that three members of Donald Trump’s cabinet will meet with Chinese representatives in London on June 9 to discuss a trade deal.
“The market will keep an eye on the trade agreement carrot as long as it’s available. The trick is whether a real deal gets done,” said Jamie Cox, managing partner of Harris Financial Group.
Trump and Xi’s Recent Conversation
On Thursday, Trump and Chinese leader Xi Jinping spoke after weeks of trade tension and a dispute over critical minerals. However, they left unresolved issues for future discussions.
Encouraging Job Numbers
Earlier in the session, U.S. data showed non-farm payrolls added 139,000 jobs last month following an upwardly revised decrease of 147,000 in April. Economists surveyed by Reuters had forecast an increase of 130,000. The unemployment rate stood at 4.2%, in line with expectations.
Following the report, traders bet that Federal Reserve policymakers have little reason to rush rate cuts. According to interest rate futures, they are expected to wait until September for any cuts, with only one more anticipated by December.
Stock Markets Rise for Second Consecutive Day
Mexican stock markets rose for the second consecutive day, keeping an eye on the economic outlook and U.S.-China trade relations.
Mexico’s leading index, the S&P/BMV IPC, increased by 0.49% to trade at 58,061.41 points, while the FTSE-BIVA, from the Mexican Institutional Securities Exchange, gained 0.53% to reach 1,171.71 points.
The indicators recorded slight weekly gains, marking four consecutive weeks in the green out of the last five.
Stock prices absorbed uncertainty stemming from U.S. tariff hikes on steel and aluminum, as well as Mexico’s attempts to negotiate these matters.
On the U.S. side, the non-farm payrolls report exceeded expectations, which was positively received by Wall Street.
Key Questions and Answers
- Q: Why did Wall Street close higher? A: Wall Street closed higher due to a better-than-expected jobs report that eased concerns about the economy, along with Tesla’s recovery from previous losses.
- Q: What is the significance of the Trump-Xi conversation? A: Trump and Xi spoke after weeks of trade tension, but left unresolved issues for future discussions.
- Q: How did the job numbers impact the market? A: The encouraging job numbers led traders to believe that Federal Reserve policymakers have little reason to rush rate cuts.
- Q: How did Mexican stock markets perform? A: Mexican stock markets rose for the second consecutive day, absorbing uncertainty from U.S. tariffs and Mexico’s negotiation efforts.
