Jobs Data Boosts Stocks in Holiday Shortened Week:
Stocks made steady gains over the holiday week thanks to strength in mega-cap tech companies and encouraging jobs reports that increased optimism of a Fed interest rate cut sometime this year.
The S&P 500 Index rose 1.95%, while the Nasdaq Composite Index added 3.50%. The Dow Jones Industrial Average edged up a modest 0.66%. The MSCI EAFE Index, which tracks developed overseas stock markets, rose 2.30% for the week through Thursday’s close.1
Source: Charles Schwab & Co., Inc
Nasdaq, S&P Extend Runs
ADP’s employment report on Wednesday showed private-sector employers added 150,000 jobs in June — slightly slower than May’s pace — adding to investor hopes that a slowing economy may prompt the Fed to adjust short-term rates as early as September. The Nasdaq and the S&P hit their 23rd and 33rd record closes, respectively, for the year.2
Friday morning’s jobs report from the Labor Department showed 206,000 jobs added last month, which also suggested a strong-but-cooling economy. News of slower job growth, slowing wage growth, and a slight uptick in unemployment helped drive down Treasury yields, and stocks finished the short week with a strong rally. The Nasdaq and S&P both closed at all-time highs on Friday.3
Source: Charles Schwab & Co., Inc
Still Catching Up?
Driving much of the job growth in last week’s reports was a post-pandemic catchup effect: sectors such as healthcare and leisure/hospitality showed they are still recovering.4
The private-sector jobs data and the Labor Department report painted a similar picture of an economy creating jobs but at a slower rate than in the past.5,6
This Week: Key Economic Data
Source: Bloomberg Finance L.P.
This Week: Companies Reporting Earnings
Source: EarningsWhispers
At Concord Asset Management, we design portfolios for the long run, with the ability to navigate various market cycles. However, you can have confidence that we are monitoring these market-moving events, and we will make reasonable, tactical adjustments as necessary.
Author
Gary Aiken
Chief Investment Officer
Concord Asset Management
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Footnotes and Sources
1The Wall Street Journal, July 5, 2024
2The Wall Street Journal, July 3, 2024
3The Wall Street Journal, July 5, 2024
4The Wall Street Journal, July 5, 2024
5The Wall Street Journal, July 5, 2024
6MarketWatch.com, July 5, 2024
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