U.S. employers fell short of expectations by adding 209,000 jobs last month, according to economists polled by The Wall Street Journal. This marks the first time in over a year that the job numbers have missed expectations. Despite this, the unemployment rate remains historically low.
Investors, however, were more focused on the latest wage growth data. Wages increased more than economists had projected, indicating that the Federal Reserve may need to raise interest rates more than anticipated.
At the close of Friday’s trading session, stocks finished lower after a volatile session. The S&P 500, Nasdaq Composite, and Dow all ended the week with losses.
Bond yields saw little change, with the benchmark 10-year yield settling at around 4.047%, slightly higher than the previous day.
The U.S. Dollar Index weakened by 0.8% following the release of the jobs data.
In the market, Rivian, an electric-vehicle maker, experienced a surge in its stock price due to strong delivery numbers. Tesla’s stock also saw a slight increase.
Energy stocks climbed alongside oil prices, with Brent crude, the global benchmark, rising over 2% to reach around $78 a barrel, its highest settle value since May. The S&P 500’s energy sector saw a jump of around 2%, with oil-field services giant Schlumberger experiencing an 8% increase in its stock price.
Solar shares also saw a rise, with First Solar leading the pack. The company announced that it had finalized a $1 billion credit line from major banks to support the funding of new factories.
To stay informed about market trends, readers can subscribe to free morning and evening newsletters, delivered every weekday.
Why were investors particularly interested in wage growth data
U.S. employers fell below expectations by only adding 209,000 jobs last month, breaking a streak of surpassing expectations for over a year. Despite this, the unemployment rate remains low. However, investors were more interested in wage growth data, as wages increased more than anticipated, suggesting a possible need for the Federal Reserve to raise interest rates higher than expected.
At the end of the trading session on Friday, stocks ended lower after a turbulent day. The S&P 500, Nasdaq Composite, and Dow all experienced losses for the week.
Bond yields remained relatively unchanged, with the benchmark 10-year yield settling at around 4.047%, slightly higher than the previous day.
The U.S. Dollar Index weakened by 0.8% when the jobs data was released.
In the market, electric-vehicle maker Rivian saw a surge in its stock price due to strong delivery numbers. Tesla’s stock also experienced a slight increase.
Energy stocks climbed alongside rising oil prices, with Brent crude, the global benchmark, reaching around $78 a barrel, its highest settle value since May. The S&P 500’s energy sector jumped around 2%, and oil-field services giant Schlumberger saw an 8% increase in its stock price.
Solar shares also rose, with First Solar leading the way. The company announced a $1 billion credit line from major banks to support the funding of new factories.
To stay updated on market trends, readers can subscribe to free morning and evening newsletters, delivered every weekday.
This unexpected combination of job growth falling short and wages surging could create an interesting dynamic for the markets. While the surge in wages may indicate a stronger economy, the shortfall in job growth raises concerns about sustainable economic recovery. Both factors should be closely monitored to assess their implications on future market trends.
The unexpected surge in wages is a silver lining amidst the disappointing job growth figures. While the slower job market may cause some concerns, the boost in wages could potentially revitalize the markets and provide individuals with better financial stability.