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Stock Losses and Gains, Higher Yields, Plus a Falling Dollar: Markets Closed

May 6 2022 00:37 UTC + 2, updated May 6 2022 16:49 UTC +2

Stocks pared losses as traders assessed the mixed US jobs report against the Fed's policy expectations. And bonds have fallen.

And the S&P 500 rose above session lows, while heading for a fifth consecutive week of decline - the longest losing streak since June 2011. While 10-year Treasury yields rose above 3%, the dollar fluctuated.

The number of non-farm payrolls rose to 428,000 in April, but a shrinking workforce may pressure employers to raise wages to bring back workers. Observers say that this dynamic may complicate the Central Bank's struggle to curb inflation, as the authorities of the United States of America are trying to match demand for labor with supply. Where did the participation rate go down - the percentage of the population working or looking for work. Although average per capita hourly earnings were below estimates on a monthly basis, it was up 5.5% from the previous year.

comments:

• The head of portfolio management at the Commonwealth Financial Network, Peter Easley, said a further decline in the participation rate "could exacerbate labor shortages, leading to further wage pressures that will inevitably translate into widespread inflation". The pace of tightening if the participation rate continues to decline amid a strong recruitment background.”
• “Markets are likely to focus more on labor supply and any prospects for adjusting wage growth,” said Sima Shah, chief strategist at Principal Global Investors. The report doesn't reveal much. As for the US Federal Reserve, nothing in the report suggests that it could remove the brakes.
• “The story here is the turnout. It didn’t go up, it went down, which goes against what the US Federal Reserve plans to increase labor demand,” said Steve Schiavaroni, portfolio manager and head of multi-activity at Federated Hermes. And wage inflation remains high. .
• “There are no major surprises in today's jobs report - it almost confirms that the labor market remains tight, giving the Federal Reserve the flexibility to directly manage its rate. Stability will be delegated, says Jason Pride, director of investments at Private Historic Heritage at Glenmede. ...
• "And the US Federal Reserve may not be affected by the rate hike," said Mike Lowengart, managing director of investment strategy at E*Trade at Morgan Stanley. "With the numbers mostly in line with expectations, the market may have already created a strong employment reading."
• Trade operations are likely to continue in global markets that saw the S&P 500 index post its worst four months since 1939, according to Bank of America Corp strategists headed by Michael Hartnett. “The base case remains the stock's lowest, the largest recorded in a note to clients.

Some of the main movements in the markets:

Shops

• The S&P 500 was down 0.5% at 10:48 a.m. PT .

• The Nasdaq 100 was down 0.4%.

• The Dow Jones Industrial Average fell 0.5% .

• The Stoxx Europe 600 was down 1.9%.

• The MSCI World Index is down 1%.

• Currencies ;

• The Bloomberg Spot Dollar Index is unchanged .

• The euro rose 0.2 percent to $1.0563 .

• The British pound fell 0.2% to $1.2335 .

• The Japanese yen fell 0.2 percent to 130.51 per dollar .

• Commitments ;

• The 10-year Treasury yield rose six basis points to 3.10%.

• The German 10-year bond yield rose nine basis points to 1.14%.

• The yield on British 10-year bonds rose three basis points to 1.99%.

• goods .

• West Texas Intermediate crude rose 1.9 percent to $110.31 a barrel .

• Gold futures rose 0.5% to $1,884.70 an ounce .

• Assisted by Sunil Jagtiani, Cecil Goucher, Dennitsa Tsikova and Vildana Hajrik .

the wall street journal