On Friday, the 7th of June 2019, all three key indexes of Wall St. had winded up the day higher as an unprecedent slowdown of US job growth had bolstered hope of an interest rate cut in a near-term outlook, meanwhile a US-Mexico deal reached on Friday (June 7th) had added to investors’ optimism.
Followed by the reveal of a sharp weakness in US labor market, investors had been betting that a waning wage growth alongside decline of US non-farm payroll would proffer enough reasons to Federal Reserve to slash interest rate in order to support the economy amid a gruesome Sino-US tariff war.
According to US non-farm payroll report released on Friday (June 7th), last month, US economy had added 75,000 jobs, much-smaller than an analysts’ estimate of 1,85,000, triggering questions whether a loss in economic momentum amid tumbling export and import indexes in light of tariff war had spread into labor markets.
Adding that rising investors’ bet on interest rate cut following poor job data had contributed to Friday’s (June 7th) equity market rally, a co-chief investment officer at OakBrook Investment LLC in Lisle, Illinois, Peter Jankovkis said, “The jobs report indicates there’s some weakness but the economy does remain relatively robust at this point.
Investors are putting weak jobs in the context that it might result in a more-timely Fed action which would be more supportive than if they wait too long”. Quoting statistics, on Friday’s (June 7th) market closure, the trade-sensitive Dow Jones Industrial Average had added 1.02 percent to 25,983.94, Standard & Poor gained 1.05 percent to 2,873.34, while Nasdaq leading the charges surged by 1.66 percent to 7,742.10.