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Stock market today: Indexes test record highs as dovish jobs report sends bond yields lower


Trader NYSETraders work on the floor at the opening bell of the Dow Industrial Average at the New York Stock Exchange on March 18, 2020 in New York.

Bryan R. Smith/AFP/Getty Images

  • US stocks tested record highs on Friday after the June jobs report sent bond yields tumbling.
  • The US economy added 206,000 jobs in June, but the unemployment rate ticked higher to 4.1%.
  • The higher unemployment rate raised hopes for imminent interest rate cuts from the Federal Reserve.

US stocks tested record highs on Friday after the June jobs report sent bond yields lower.

The US economy added 206,000 jobs in June, which was slightly ahead of economist estimates of 200,000, but below the May jobs report, which was revised lower to 218,000 from 272,000.

The April jobs report was also revised lower to 108,000 jobs added that month, down from the initial reading of 165,000.

The job revisions, combined with the unemployment rate ticking higher to 4.1% from 4.0% in June, sent bond yields tumbling and renewed hopes for interest rate cuts from the Federal Reserve.

The chances of a September interest rate cut of 25 basis points rose to 72% Friday morning, according to the CME FedWatch Tool.

With the 10-year US Treasury yield dropping about five basis points to 4.31%, LPL chief global strategist Quincy Krosby said the decline “suggests an economic landscape that continues to slow down at a faster pace.”

“Today’s report, in conjunction with the latest ISM Manufacturing and Service Sector PMI date releases indicating that the broader economy has moved into contraction territory, should have Fed officials troubled that the desired cooling in the economy could transition into a frigid summer,” Krosby said.

Here’s where US indexes stood shortly after the 9:30 a.m. opening bell on Friday:

Here’s what else is going on today:

In commodities, bonds, and crypto:

  • West Texas Intermediate crude oil rose 0.33% to $84.16 a barrel. Brent crude, the international benchmark, was higher by 0.27% to $87.67 a barrel.
  • Gold edged higher by 0.64% to $2,384.60 per ounce.
  • The 10-year Treasury yield dropped five basis points to 4.31%.
  • Bitcoin dropped 2.72% to $55,489.

Read the original article on Business Insider