On Friday, all three key indices of Wall St. rounded off the session in an upbeat tenure with so-called tech-related growth stocks leading the gains, as a softer-than-anticipated US nonfarm payrolls data in May had conciliated investors’ concern about an early withdrawal of fiscal support alongside a potential policy shift from the US Federal Reserve.
In point of fact, latest upsurge in the Wall St., which helped major US stock indices notch a second straight week of percentage gains, was largely prodded by US Labour Department’s closely observed nonfarm payrolls data that had missed analysts’ expectation, but had reported a decent job growth.
According to the US Labour Department, US nonfarm payrolls grew by 559,000 jobs last month, missing an analysts’ estimate of 650,000 new jobs with millions of Americans sitting idle at home in context of a massive fiscal stimulus alongside an utterly dovish US Fed stance, eventually cancelling out worries that the economy might face off a prolonged period of inflation-surge.
Apart from that, as a latest nonfarm payroll data alongside a plunge in factory orders for US-borne goods in April despite a robust rise in domestic demands, had eased market participants’ angsts of an inflation-led rate hike, S&P 500’s tech sub-sector soared as much as 1.8 per cent, while US long-term Treasury bond Yields edged lower, nonetheless, interest-exposed financials dropped 0.4 per cent.
In tandem, growing investors’ frets that a rapidly recovering US economy might enforce US Fed to taper off supports for the economy, had been keeping investors on their heels lately.
Wall St. surges after softer-than-anticipated job growth last month
Quoting statistics, in the day’s Wall Street closing bell, trade-sensitive Dow gained 0.52 per cent to 34,756.39 and benchmark S&P 500 soared 0.88 per cent to 4,229.89, while tech-heavy Nasdaq mushroomed as much as 1.47 per cent to 13,814.49, leading the charges in the day’s US money markets.
On the week, Nasdaq rose 0.15 per cent and S&P 500 added 0.46 per cent, while Dow clocked 0.58 per cent in weekly gains. Meanwhile, voicing a submissive support on Fed Chair Powell’s policy stance amid a 29-year peak inflation reading released earlier in the week, a chief investment strategist at State Street Global Advisors in Boston, “It signals the economy continues to recover, but not too quickly to get the Fed to begin either curtailing (bond) purchases or raising rates”.
US Federal Reserve said earlier in the week that the latest leg of inflation-surge would highly unlikely to persist for a prolonged period of time.