The stock market’s rally continued in the wake of Friday’s jobs report as the major indexes are off to their best start to a month so far this year.
The S&P 500 rose 1% to finish north of 6000 for the first time since Feb. 21. The Dow Jones Industrial Average rose 443 points, or 1.1%. The Nasdaq Composite gained 1.2%.
All three indexes are now trading in positive territory year to date for the first time together since Feb. 21, according to Dow Jones Market Data.
The market rallied on Friday after the Labor Department said the U.S. economy added 139,000 nonfarm jobs in May, which countered worries on the market that tariffs and immigration crackdowns had started to seep into the labor market in a big way.
“While tariffs loom in the background, their impact on hiring has yet to materialize,” writes Mike Sanders, head of fixed income at Madison Investments. “It’s possible that companies are delaying decisions until there is more clarity on trade policy.”
Stocks picked up steam after President Donald Trump announced U.S. and Chinese officials will meet on Monday to discuss trade. The president said he thought the meeting “should go very well.”
Bonds, on the other hand, struggled as traders turned to riskier assets. The yield on the 2-year Treasury note rose to 4.04%. The 10-year yield jumped to 4.51%.
President Trump repeated his calls for Federal Reserve Chair Jerome Powell to lower interest rates despite the better-than-expected report, but Wall Street sees the chance of a July interest-rate cut of just 16.5%, according to the CME FedWatch Tool. That figure is down from 31.4% on Thursday. Odds of a September cut were down to 60.6% from 74.3% prior to the jobs report.
“The slowdown in the job market has been quite smooth so far without many surprises. If payroll growth trudges on like this, the Fed will likely remain in ‘wait and see’ mode,” writes Jeffrey Roach, Chief Economist for LPL Financial. “Markets breathed a sigh of relief after this morning’s payroll release.”
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