Most Stocks Rise After Jobs While Chipmakers Sink: Markets Wrap
(Bloomberg) — A slower-than-anticipated increase in US jobs drove most stocks higher as short-dated bond yields fell on bets the Federal Reserve won’t be forced to raise interest rates any time soon.
Those wagers lifted the vast majority of shares in the S&P 500, though index lost steam as chipmakers tumbled. The Dow Jones Industrial Average hovered near all-time highs. Treasury two-year yields dropped five basis points to 4.13%. The dollar slipped. Swap traders dialed back expectations of a Fed hike in coming months. Oil deepened its slide below pre-war levels.
US hiring slowed sharply in June, curbing some of the budding momentum in job growth this year. Nonfarm payrolls increased 57,000 last month after downward revisions to the prior two months took some of the shine off recent blockbuster reports. The unemployment rate fell to 4.2%.
“Just when investors thought they had the labor market figured out, the June jobs report threw them a curveball,” said Bret Kenwell at eToro. “A disappointing jobs report isn’t exactly good news, but it may give risk-on assets a silver lining: Less pressure on the Fed to take a hawkish stance.”
While today’s report doesn’t scream labor-market trouble, he noted it does cool the narrative a bit. That may nudge the conversation back toward the Fed’s dual mandate — balancing inflation with employment — rather than forcing policymakers to focus almost exclusively on price pressures, Kenwell added.
Lately the narrative has been around inflation – which remains too high – but if the employment mandate is brought back into play, it can increase the odds of leaving rates on hold, which all things being equal would be much better for the market than raising rates, according to Chris Zaccarelli at Northlight Asset Management.
“We still see a path for the Fed to stay on hold for the rest of the year, however any further upside surprises to inflation could convince the committee to hike sooner rather than later,” said Kay Haigh at Goldman Sachs Asset Management.
Fed Chairman Kevin Warsh this week said price risks have come down in recent weeks, while repeating his determination to bring inflation back to the US central bank’s 2% target. While officials held rates steady last month, they did signal growing support for hikes this year amid inflation running at its fastest since 2023.
“Warsh can wipe his brow,” said Brian Jacobsen at Annex Wealth Management. “The labor market isn’t overheating. Inflation expectations are moderating. It means the Fed can take the whole summer off it wants as it won’t have to hike or cut.”
Hiring has downshifted on the margin and the inflation impulse that kept the Fed on hold has been energy-driven so far, a pressure that should fade amid a slide in oil prices, noted Jason Pride at Glenmede. Should that play out alongside a labor-market holding at this lower gear, the Fed may find itself in a position to cut rates later this year, he said.
Corporate Highlights:
Anthropic PBC is in talks with Samsung Electronics Co. to be a manufacturing partner for a custom artificial-intelligence chip, the Information said, citing people familiar with the plan. OpenAI has begun preliminary discussions about giving the US government a 5% stake in the ChatGPT-developer, the Financial Times reported, citing two people familiar with the talks. For the second straight quarter, two Blue Owl Capital Inc. private credit funds were hit with the industry’s largest redemption requests, forcing the manager to again cap withdrawals. Tesla Inc.’s vehicles sales beat Wall Street’s modest expectations by a wide margin, gaining in a slower-growing global market for plug-in cars. Rivian Automotive Inc. raised its full-year sales outlook in a promising sign as the maker of electric vehicles begins deliveries of its lower-cost SUV seen as critical to the company’s future. What Bloomberg strategists say…
“The market seems to be slowly coming to the view that the Warsh Fed is not too dissimilar to the Powell Fed. If that means a long hold rather than hikes — despite core inflation above 3% — it also means curve steepening eventually.”
—Edward Harrison, Macro Strategist, Markets Live. For the full analysis, click here.
Some of the main moves in markets:
Stocks
Stocks
The S&P 500 was little changed as of 11:16 a.m. New York time The Nasdaq 100 fell 1.3% The Dow Jones Industrial Average rose 0.7% The Stoxx Europe 600 rose 1.6% The MSCI World Index rose 0.4% Currencies
The Bloomberg Dollar Spot Index fell 0.5% The euro rose 0.6% to $1.1442 The British pound rose 0.7% to $1.3369 The Japanese yen rose 1% to 160.94 per dollar Cryptocurrencies
Bitcoin rose 2.4% to $61,523.79 Ether rose 4.7% to $1,692.2 Bonds
The yield on 10-year Treasuries declined two basis points to 4.46% Germany’s 10-year yield advanced two basis points to 2.90% Britain’s 10-year yield advanced one basis point to 4.77% Commodities
West Texas Intermediate crude fell 1.3% to $67.70 a barrel Spot gold rose 2.3% to $4,124.05 an ounce ©2026 Bloomberg L.P.
