Daily Market Color

Inflation Worries Subside on Jobs Report

Jobs gain most in 10 months; unemployment rate unexpectedly rises

Nonfarm payrolls increased 850,000 in June, the largest gain in 10 months and beating economists’ expectations of 720,000. The strong beat was offset by the unemployment rate unexpectedly increasing 0.1% to 5.9% and labor participation rate holding unchanged at 61.6% — well below pre-pandemic levels.

S&P on pace for 7th straight session increase, rates fall across the curve

Equities continued their rally, with the S&P looking to notch its 7th straight day of increases. This morning’s nonfarm payroll jobs beat was enough to show the U.S. economy’s continued recovery from the COVID pandemic while also abating inflationary fears. Swap rates and yields were down across the curve during the shortened trading session. The belly of the curve seeing the most activity as traders view the jobs report data will not deter the Fed’s accommodative policies in the near-term . The 10y UST yield goes into the holiday weekend down 3 bps to 1.43%.

The markets will be closed on Monday, July 5th in observance of the July 4th holiday. We wish everyone a safe and happy Independence Day weekend!

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