U.S. Stocks Rise as Rate Hike Expectations Ease Amid Weak Jobs Data... S&P Hits All-Time High

S&P Hits Record High
Worsening Employment Data Seen as a Positive

On August 7 (local time), all three major U.S. stock indices closed higher as expectations for further U.S. interest rate hikes retreated due to worsening employment data.

On the New York Stock Exchange, the Dow Jones Industrial Average ended the session at 54,036.93, up 151.83 points (0.28%) from the previous close.

The Standard & Poor’s 500 Index closed at 7,757.64, up 47.68 points (0.62%), while the tech-heavy Nasdaq Composite finished at 26,690.62, rising by 342.26 points (1.30%) over the prior session.

The S&P 500 set a new all-time closing high with this increase.

A trader is working on the floor of the New York Stock Exchange in New York City, New York State, USA. Photo by Yonhap News.

On a weekly basis, the S&P 500 also gained 3.6%. Bloomberg noted this was the highest weekly increase since April of this year.

The New York stock market interpreted the negative economic news—deterioration in employment—as a positive. According to the U.S. Department of Labor, nonfarm payrolls in July decreased by 23,000 compared to the previous month. This result sharply missed the consensus forecast compiled by Dow Jones, which projected an increase of 83,000 nonfarm jobs in July.

The market immediately reflected expectations that the U.S. Federal Reserve would hesitate to raise its benchmark interest rate.

With weakened expectations of a Fed rate hike, U.S. Treasury yields declined. The yield on two-year Treasurys, which is sensitive to monetary policy, dropped 0.05 percentage points from the previous session to 4.20%. The yield on ten-year Treasurys also fell by 0.02 percentage points to 5.65%.

This content was produced with the assistance of AI translation services.