Key takeaways from the blowout May jobs report
What was the unemployment rate in May, and how did it change from the previous month?
The unemployment rate in May was 4%, which marked a slight increase from the previous month when it stood at 3.9%. This is the first time in more than two years that the jobless rate is not below 4%. Despite the increase in unemployment, the U.S. economy added a robust 272,000 jobs in May, surpassing expectations. The rise in unemployment can be attributed to workers aged 24 and under, as prime-age employment actually increased. However, the labor force participation rate for prime working-age women (25-54 years old) set a fresh all-time high of 78.1% in May. Overall, the labor market remains strong, with some experts suggesting that it is still gliding toward a soft landing.
What are traders' expectations regarding Federal Reserve rate cuts for the year, according to the CME FedWatch Tool?
According to the CME FedWatch Tool, traders are pricing in one to two rate cuts this year. However, it is important to note that the timing of these cuts remains uncertain, with some experts suggesting that a cut might not happen until September at the earliest.
What was the performance of the Dow, S&P 500, and Nasdaq Composite on the volatile trading day described?
On the volatile trading day described, stocks slipped, and all three major indexes experienced losses. The Dow fell 87 points, or 0.2%. The S&P 500 slid 0.1% and the Nasdaq Composite lost 0.2%. Despite the daily losses, all three indexes gained for the week. The mixed performance came as investors parsed a stronger-than-expected May jobs report, which showed the economy adding 272,000 jobs, above expectations for 180,000 positions added. The unemployment rate rose to 4%, and wage growth rose for the first time in months, according to data from the Bureau of Labor Statistics.