July 3, 2024, US Stock Market – The Global equities rose while the US dollar weakened. This was largely due to softer-than-expected labor market data, which led investors to anticipate potential interest rate cuts by the Federal Reserve later this year.
Global Equities rose due to softer-than-expected labor market data
U.S. Labor Department data showed an increase in initial jobless claims, indicating a slight softening in labor market conditions. Data released on July 3rd showed an increase in initial jobless claims for the week ending June 29th, slightly above expectations. This suggests a potential slowdown in the labor market.
The ADP National Employment Report (June) released on July 3th revealed a significant slowdown in private sector job growth for June, with the lowest figures since January 2021. This further reinforces the softening trend in the labor market.
This data fueled expectations that the Federal Reserve might cut interest rates sooner than anticipated to stimulate the economy.
Global equities responded positively to the news of softer-than-expected labor market data , with MSCI’s global stock index and Europe’s STOXX 600 index both rising.
The US dollar fell against a basket of currencies, including the euro and the yen
Treasury yields: Benchmark 10-year Treasury yields also dipped following the jobless claims data and signs of weakness in the manufacturing sector.
Yen’s performance: The Japanese yen weakened further against the US dollar and reached a record low against the euro.