Stocks Hit Record as Jobs Slowdown Eases Fed Hike Fears – US Market Wrap
A sharp cooling in the US labor market drove stocks higher and bond yields lower, fueling expectations that the Federal Reserve won’t need to raise interest rates any time soon. Those bets pushed the S&P 500 to a record high at the end of its strongest week since April. The index also gained after it was reported that the US will lift its blockade on Iranian ports once an agreement to restore shipping through the Strait of Hormuz is reached. Oil prices eased in late trading.
Short-dated Treasuries outperformed, while money markets continued to price a Fed rate increase in 2026, though not until December. The dollar weakened.
US employers unexpectedly shed jobs in July, while hiring figures for the previous two months were revised lower, signaling the labor market is softer than previously believed following unexpectedly strong growth earlier this year.
Nonfarm payrolls fell by 23,000 last month, while May and June employment gains were revised down by a combined 103,000. The unemployment rate declined to 4.1% as labor force participation continued to fall, while wage growth moderated.
