Wall Street and European Markets Rally After US Jobs Report Surprise
Synopsis
Markets on both sides of the Atlantic finished the week with strong gains after the latest US Jobs Report revealed hiring slowed less than expected in April. Both Wall Street and European markets responded…
Markets on both sides of the Atlantic finished the week with strong gains after the latest US Jobs Report revealed hiring slowed less than expected in April. Both Wall Street and European markets responded positively, showing confidence that the world’s largest economy is more resilient than feared, despite ongoing trade tensions linked to Donald Trump’s tariffs.
US Jobs Report Beats Expectations
The highly anticipated US Jobs Report showed that in April, employers added 177,000 jobs. While this represents a slowdown compared to March (185,000 jobs), it outperformed economists’ forecasts of just 130,000.
- Unemployment Rate Steady: The unemployment rate remained unchanged at 4.2%.
- Sector Gains and Losses: Healthcare, and transportation and warehousing saw the largest job gains in April. However, federal government employment declined by 9,000.
The Bureau of Labor Statistics (BLS) also revised down previous job gain figures for February and March by 58,000, reflecting a more nuanced view of the jobs market.
European Markets See Sharp Gains After US Jobs Report
The positive news from the US gave European markets a significant boost. On Friday:
- The FTSE 100 index closed 1.2% higher at 8,596, notching its longest-ever winning streak with 15 straight days of gains.
- Germany’s Dax rose 2.5%.
- France’s Cac climbed by 2.3%.
These gains built on earlier momentum following reports of possible trade talks between Beijing and Washington, which helped lift investor sentiment.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said hopes for easing tensions and optimism in the face of resilient US employment numbers were driving the “record winning streak.”
Wall Street Rallies as US Employment Proves Resilient
The S&P 500 was up 1.5% and the Dow Jones gained 1.3% by early Friday afternoon in New York. The US Jobs Report fuelled confidence, helping investors look past concerns over sweeping tariffs introduced by the White House, which had unsettled global markets only one month earlier.
Despite worries about the impact of tariffs on the US and European economies, April’s hiring pace suggests that companies are still adding jobs at a steady rate. This resilience was welcomed across investment circles.
The FTSE 100’s Recovery From Tariff Fears
The FTSE 100’s historic run is notable, especially since it has now recovered almost all its losses from early last month, before the tariffs were announced. After Trump revealed his wide-reaching import tariffs, markets panicked on fears of a trade war. However, the FTSE’s performance in recent weeks shows renewed investor confidence, aided by the solid US Jobs Report and hints of a thaw in US-China trade relations.
Susannah Streeter remarked that the “fresh optimism” was pulsing through the markets, pointing to a more hopeful outlook for both the UK and global economies.
A Closer Look at the April US Jobs Report
While the main headline was positive, the BLS highlighted some cautionary notes. Federal government employment continued to fall, declining by 9,000 jobs in April and 26,000 since January, as the department of government efficiency led by Elon Musk pressed ahead with cuts. The report notes that the BLS figures do not account for people on paid leave or receiving severance payments, so the real impact could be higher.
Despite these losses, gains in sectors like healthcare and transportation have underpinned overall labour market resilience, supporting market rallies in both the US and Europe.
Source
The Guardian - Wall Street and European markets finish week on a high after US jobs report
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