In the aftermath of the latest job report, U.S. stocks rose with the Dow Jones, S&P 500, and Nasdaq Composite Index all showing gains. Despite some slight discrepancies in the data points compared to May’s revised figures, overall the news was positive as it may please the Federal Reserve, which is closely monitoring signs that inflation is easing.
Comerica Wealth Management CIO John Lynch has advised investors not to bail from market rallies just yet. This advice comes after U.S. employers added 206,000 jobs in June, slightly below the revised 218,000 added in May but more than expected. The unemployment rate inched up to 4.1% from 4%, but this increase was due to adjustments made to April and May data points that indicate fewer jobs were created than previously thought.
The hiring surge was seen across a range of sectors including government, social assistance, and healthcare while retail and manufacturing lost workers. The ADP report showed that companies added 150,000 jobs last month, lower than the 160,000 gain expected by economists but still an indication of a strong job market. Both job reports are closely watched by the Federal Reserve as they consider when to begin a rate-cutting cycle.
Federal Reserve Chairman Jerome Powell has emphasized the need for inflation to be lower before considering rate cuts