Wall Street concludes sharply higher after US employment, S&P 500 near record

The New York Stock Exchange finished solidly in the green on Friday, paradoxically reassured by mixed US employment figures, which show that the Fed can be patient before tightening its monetary policy.

According to final figures, the Dow Jones index rose 0.52% to 34,756.39 points. The technology-intensive Nasdaq jumped 1.47% to 13,814.49 points, largely regaining the ground lost the day before. The extended S&P 500 index closed very close to its record, at 4,229.89 points (+ 0.88%).

The number of jobs created in the United States doubled in May compared to April, to 559,000 jobs, but remained well below the 720,000 expected by analysts.

Even though the unemployment rate fell to 5.8% from 6.1%, the labor market is still far from its pre-pandemic level.

“It was a jobs report that was neither too hot nor too cold, obviously and the fact that we haven’t seen a big wage increase suggests that the Fed is not going to be in a rush to start the debate. reduction in asset purchases, faster than expected, “said Peter Cardillo of Spartan Capital Securities for AFP.

The US Central Bank lowered overnight interest rates to zero with the pandemic and bought $ 120 billion in assets each month including treasury bills to smooth credit, support recovery and influence rates downward. But during its last monetary meeting, some members of the Committee argued that it was necessary to start discussing the reduction of this windfall, which made the markets nervous.

For TD Ameritrade’s JJ Kinahan, this slower than expected pace of job creation “does not change the whole picture, but the timing of” monetary policy tightening “may not be as fast as it is. we thought so “.

As soon as the employment figures were announced, “we will see bond yields relax significantly and the dollar react negatively,” noted Mr. Cardillo.

Yields on 10-year Treasury bills fell to 1.55% on Friday from 1.63% just before the Labor Department’s announcement. The dollar fell 0.35% against the euro.

Ten out of eleven S&P sectors finished in the green, led by information technology (+ 1.92%) and communication services (+ 1.36%), which are highly represented in the index Nasdaq, and very sensitive to fears of inflation and the prospect of a tightening of monetary policy.

Tesla has regained ground (+ 4.61%) but also Twitter (+ 3.49%) and Facebook (+ 1.32%), the social media giant having announced to ban Donald Trump for two years and to be more severe with the words of politicians.

Pershing Square Tontine Holdings, the SPAC project of billionaire Bill Ackman, has dropped almost 12% after confirming that it is in talks to buy a stake in Universal Music, a subsidiary of Vivendi.

Meme Stocks, favorites of online stock marketers, whose volatility has stirred Wall Street this week, have declined. This was the case for the chain of cinemas AMC (-6.68% to 47.91 dollars) or the video game stores GameStop (-3.80%).

Over the week, the three indices rose very slightly by 0.66% for the Dow Jones, 0.48% for the Nasdaq and 0.61% for the S&P 500.