The markets got their wish on Thursday, a huge nonfarm jobs report allowing them to pretend that the US isn’t posting daily covid-19 case increase records.
While less surprising that May’s shock jobs addition, June’s figures were even more muscular, with 4.8 million Americans hired across the month. Unquestionably the biggest one-month gain in the history of the nation (record-breaking economic data isn’t something this pandemic has been short on).
Just as important, that May figure was revised from 2.509 million to 2.699 million, dispelling the idea of an erroneous reading.
The unemployment rate, meanwhile, dropped from 13.3% to an easily better than forecast 11.1%. When you remember that last month analysts were expecting a rate of 19.4%, it really highlights how astonishing this recent jobs data has been.
However, the situation isn’t completely rosy. The average hourly earnings showed a 1.2% contraction month-on-month, missing out on the forecast improvement. The weekly jobless claims reading showed another 1.427 million Americans filed for unemployment for the 7 days to June 27th. And, crucially, those job additions across May and June barely account for a third of those lost in April.
Yet, hungry to keep the good times rolling, investors ignored the many negatives circling the markets like vultures to propel the Western indices sharply higher.
The Dow Jones jumped 270 points, pushing the US index back past 26000, while the Nasdaq hit its latest all-time peak.
The FTSE gained a bit of extra juice following the jobs data, climbing 1.2% to 6230. And the Eurozone indices were positively ecstatic, with the DAX and CAC surging 2.9% and 2.7% respectively.
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