Equity Markets Extend Gains on Strong Jobs Data

Equity Markets Extend Gains on Strong Jobs Data

A week after reaching record highs, the S&P 500 and the more tech-centric Nasdaq extended their gains. In a holiday-shortened week for U.S. markets, equities ended on a strong note following a better-than-expected jobs report on Thursday. Global equities, as measured by the MSCI All Country World Index (ACWI), rose 1.24% for the week, while U.S. equities, represented by the S&P 500, outperformed with a gain of 1.75%. Small-cap stocks led the way, with the Russell 2000 Index climbing 3.6%, bringing the index back into positive territory for the year. Last Monday marked the end of the second quarter, with the MSCI ACWI gaining 10.85% and the S&P 500 advancing 10.52% over the three-month period.

June Jobs Report

As mentioned above, the week ended on a strong note with a better-than-expected June jobs report. The U.S. economy added 147,000 jobs during the month, surpassing consensus estimates of around 117,000. Notably, job growth figures for the previous two months were revised upward, marking a shift from the recent pattern of downward revisions. The unemployment rate edged down to 4.1% from 4.2% in May.

U.S. Economy

Other highlights this week: Congress narrowly passed a major budget and domestic policy bill, now awaiting the president’s signature, with Senate approval via a tie-breaking vote from the vice president and a narrow 218–214 House vote on Thursday. Treasury yields rose as the strong jobs report lowered expectations for near-term rate cuts—the 2-year climbed from 3.68% to 3.88%, and the 10-year from 4.29% to 4.35%. The U.S. dollar strengthened modestly but remained near its lowest level since early 2022, ending the quarter down over 5% and roughly 10% lower year-to-date.

Looking Ahead

In the week ahead, key releases include the minutes from the Federal Reserve’s June 17–18 meeting, wholesale inventory data from the U.S. Census Bureau, and weekly jobless claims from the Department of Labor. Investors will focus on the Fed minutes for insights into the central bank’s outlook and potential rate moves. Wholesale inventories will offer a view into supply chain trends, while jobless claims remain a timely indicator of labor market health.

As Always

I’d like to leave you with the final line we’ve used since we started these commentaries back at the very height of market volatility in March 2020. Always remember that we create financial/investment plans not for the easy times, but to prepare for the tough ones.