S&P 500, Nasdaq hit record highs as strong June jobs data tempers slowdown fears

S&P 500, Nasdaq hit record highs as strong June jobs data tempers slowdown fears

S&P 500, Nasdaq hit record highs as strong June jobs data tempers slowdown fears

But rate cut hopes take a knock as Treasury yields jump and Fed expectations reset

US stocks rallied on Thursday, with the S&P 500 and Nasdaq Composite scaling fresh record highs, after a stronger-than-expected jobs report calmed recession fears and signalled continued resilience in the world’s largest economy.

The S&P 500 was up 0.4 percent, while the Nasdaq Composite gained 0.6 percent in early trade. The Dow Jones Industrial Average rose 106 points, or 0.2 percent. All three benchmarks are poised to end the week with solid gains, ahead of Friday’s market holiday for Independence Day.

Data released by the US Bureau of Labor Statistics showed nonfarm payrolls rose by 147,000 in June, beating economists’ expectations of 110,000. The May print was also revised upward to 144,000. Unemployment fell to 4.1 per cent, defying projections of a rise to 4.3 percent.

While the report underscores the economy’s underlying strength, it dampened hopes of an imminent Fed rate cut, pushing Treasury yields higher and softening bets of policy easing in July. According to the CME FedWatch tool, markets are now pricing in a 93 percent chance of no cut at this month’s Federal Reserve meeting.

“Once again, the labour market defies expectations, showing not just resilience but real strength,” said Karen Manna of Federated Hermes. “With the fog of uncertainty beginning to lift, markets may start repricing in response to this momentum.”

Thursday’s rebound also helped shrug off Wednesday’s softer ADP data, which had spooked markets with a 33,000 drop in private payrolls. The official government report has now restored confidence, at least for the near term.

Meanwhile, investors are watching the progress of President Trump’s tax and spending bill, which passed the Senate earlier this week and is now headed for a final House vote. The bill is a key part of the administration’s second-term policy push, and markets remain alert to its fiscal implications.

Trading volumes are expected to remain thin as the NYSE and Nasdaq shut early at 1 p.m. ET, with markets closed Friday for the 4 July holiday.

European Market Mid Session

The pan‑European Stoxx 600 is slightly positive, buoyed by financials, though energy and mining lag amid soft commodity trends Meanwhile, European central banks prepare for looming policy meetings, and bond markets are monitoring yields tied to evolving fiscal and geopolitical developments.

In a major development, Santander has agreed to acquire UK lender TSB from Banco Sabadell for €3.1 billion to €3.4 billion, following a competitive process that saw Barclays also in contention. The transaction, subject to shareholder support in August, enables Sabadell to fund a generous macro‑dividend and strengthens Santander's UK retail deposits, pushing Santander UK to 12  percent of the mortgage market.