Economy

Jobs Report Spurs Some Optimism On The Street

Equities were up. Bonds were down. Investors, by and large, acted the way one might expect amid a jobs report that came in above expectations. The global geopolitical climate remained mixed.

Reuters noted Friday (June 1) that the jobs report helped cement expectations of another rate hike by the Federal Reserve — one that could come as early as this month. Such anticipation helped send stocks higher — and, by way of example, the newswire cited the fact that the MSCI All Country World Index gained about 74 basis points in intraday trading. The Dow Jones Industrial Average was up by about 80 basis points, while the broad measure known as the S&P 500 was up roughly 1 percent.

In terms of the headline numbers, the United States added as many as 223,000 jobs last month, topping expectations that the number would come in at 190,000. With the latest report, the unemployment rate stood at 3.8 percent. The last time the country saw that tally was in April of 2000. The 3.8 percent reading is the lowest level seen since 1969.

Other numbers showed some strength as well. Wage growth quickened a bit, to a 2.7 percent pace as measured against last year, 10 basis points better than expected. Measured on a monthly basis, average hourly earnings grew by 30 basis points from last year, building on the 10 basis points seen in April.

May’s report marked the 92nd-straight month that jobs have grown in the U.S. That uninterrupted string is a record. Labor force participation was 62.8 percent in April and ticked down a bit in May, by 10 basis points.

As reported by Business Insider, and as stated in an interview with Josh Wright, chief economist at recruiting software firm iCIMS, the latest data “supports the idea that fiscal stimulus is having an impact, and it can be effective. Whether or not it’s the right move now is something that we’ll continue to debate now and in the future, but it certainly looks like it’s feeding through,” he said.

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