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An unexpected slowdown in the US labor market boosted actions amid speculation that the Federal Reserve will not be forced to raise interest rates in the short term.
These bets stoked appetite for the riskier segments of the market, and the S&P 500 pared its weekly loss. Although the Treasuries little changed after a brief rally, money markets were no longer fully pricing in a rate hike FED in 2026. Falling oil prices also lifted sentiment. Group of Seven countries and their partners are preparing to release up to 100 million barrels of diesel and crude oil.
The U.S. created fewer jobs than expected in September and wage growth slowed, a sign of some caution among employers about rising costs.
Nonfarm payrolls increased by 29,000 last month, following a downward revision from the previous two months, according to data from the Bureau of Labor Statistics published on Friday. The figure was below all estimates in a survey of Bloomberg among economists. The unemployment rate rose to 4.2%, partly due to growth in the labor force.
“A weaker-than-expected jobs report should clearly ward off the possibility of a rise in inflation.” FED in October,” he said. Seema Shahof Principal Asset Management. “Lower payroll growth, a slowdown in wages and a higher unemployment rate all point to a labor market that is cooling rather than accelerating again.”
With the unemployment still at historically low levels, officials of the FED They can keep their attention focused on inflation as they evaluate when to raise rates again.
The September employment report reinforces the case for a FED patient, rather than one that needs to move more aggressively with a series of hikes to fulfill its dual mandate, according to Jim Bairdof Plant Moran Financial Advisors.
“Today’s report should provide relief to the bond market by reducing concerns about aggressive rate hikes,” he said. Angelo Kourkafasof Edward Jones. “For stocks, a largely stable labor market, combined with solid earnings growth, supports the idea that fundamentals remain constructive heading into the final months of the year.”
The latest data could revive the “bad news is good news” narrative, but waiting for a weaker labor market just to get easier financial conditions comes at too high a cost, according to Bret Kenwellof eToro. Inflation remains a problem, but a deterioration in the labor market would generate a completely different one, he noted.
“Looking ahead, 5% in the bonuses of the Treasure 10 years is the level to observe. “If it becomes the new floor, it could call into question the idea that markets can continue to absorb higher rates without consequences,” he added. Kenwell.
Some of the main movements in the markets:
Actions
- The S&P 500 was up 0.6% as of 11:13 a.m. New York time
- The Nasdaq 100 advanced 1%
- The Dow Jones Industrial Average gained 0.2%
- The Stoxx Europe 600 rose 0.7%
- The MSCI World index advanced 0.5%
Coins
- The Bloomberg Dollar Spot Index fell 0.3%
- The euro appreciated 0.2% to US$1.1267
- The British pound advanced 0.3% to US$1.3237
- The Japanese yen strengthened 0.2% to 157.76 per dollar
Cryptocurrencies
- Bitcoin rose 1.1% to US$85,563.07
- Ether gained 0.2% to US$2,704.67
Bonuses
- The 10-year Treasury yield was little changed at 5.25%
- The yield on 10-year German bonds fell five basis points to 3.46%
- The yield on British 10-year bonds fell four basis points to 5.36%
Raw materials
- West Texas Intermediate crude fell 2.5% to US$90.55 a barrel
- Spot gold fell 0.8% to US$4,144.51 an ounce
