Stocks rose last week despite conflicting stories from economic reports.
The Dow Jones Industrial Average inched up 0.29 percent while the Standard & Poor’s 500 Index powered ahead 1.31 percent. The Nasdaq Composite led, picking up 2.38 percent. The MSCI EAFE Index tracks developed overseas stock markets and rose 1.29 percent for the week through Thursday’s close.1
All Eyes on the Jobs Report
Weak manufacturing data prompted declines early in the week, reflecting investor concerns over the economy’s strength. But stocks rallied in anticipation of the jobs report on Friday.
However, the market reaction was mixed when the stronger-than-expected jobs report finally came. The S&P 500 touched a record high intraday before profit-taking late in the session.2,3
The Catalyst That Wasn’t
The week closed with a jobs report that underscored the economy’s resilience while highlighting the data’s mixed nature.
The 272,000 jobs added in May were higher than the 190,000 economists expected. At the same time, wages rose 4.1 percent from a year ago. The strong jobs report and surprise wage increase supported the narrative that the Fed may now wait longer before considering a move on interest rates.4
Although inflation now exceeds the central bank’s 2 percent target, the jobs report suggests that economic growth remains powerful despite higher short-term rates.4
Footnotes and Sources
- The Wall Street Journal, June 7, 2024
- CNBC.com, June 6, 2024
- The Wall Street Journal, June 7, 2024
- The Wall Street Journal, June 7, 2024
