- U.S. stocks tested all-time highs on Friday after bond yields plummeted following the June jobs report.
- The U.S. economy added 206,000 jobs in June, but the unemployment rate rose to 4.1%.
- Rising unemployment has raised expectations that the Federal Reserve will cut interest rates in the near future.
U.S. stocks tested record highs on Friday as bond yields fell following the June jobs report.
The U.S. economy added 206,000 jobs in June, slightly more than the 200,000 economists had expected but below a downwardly revised May jobs report to 218,000 from 272,000.
April’s employment figures were also revised downward from the initial 165,000 to 108,000.
A revised jobs report and a rise in the unemployment rate to 4.1% from 4.0% in June sent bond yields plummeting and rekindled expectations of a rate cut from the Federal Reserve.
The likelihood of a 25 basis point rate cut in September rose to 72% on Friday morning, according to the CME FedWatch tool.
After the 10-year Treasury yield fell about 5 basis points to 4.31%, Quincy Krosby, chief global strategist at LPL, said the decline “suggests that economic conditions continue to slow at a faster pace.”
“Today’s report, coupled with the latest ISM manufacturing and services sector PMIs showing the overall economy moving into contraction territory, should have Fed officials concerned that a welcome economic cooldown could be slipping into a frigid summer,” Crosby said.
Below are U.S. stock indexes as of the start of trading at 9:30 a.m. on Friday.
What else is happening today:
Commodities, Bonds and Cryptocurrencies:
- West Texas Intermediate crude rose 0.33% to $84.16 a barrel, while the international benchmark Brent crude rose 0.27% to $87.67 a barrel.
- Gold rose 0.64% to $2,384.60 per ounce.
- The yield on the 10-year Treasury note fell 5 basis points to 4.31%.
- Bitcoin fell 2.72% to $55,489.
