Stocks climb as strong US jobs data pushes off rate hike

AFP | London

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Stock markets rose and the dollar slid yesterday as strong jobs data showed the resilience of the US economy and reduced the likelihood of interest rate cuts.

Investors were also keeping a close eye on President Donald Trump’s bid to push through a tax-cutting budget and reach trade deals.

London’s stock market and the pound recovered, having taken a knock Wednesday on rumours that British finance minister Rachel Reeves faced losing her job.

Oil prices fell, with OPEC and the cartel’s crude-producing allies expected to announce a rise to output Sunday.

Investors had been keenly awaiting the US government’s monthly non-farm payrolls report, seen as one of the best data points on the health of companies and the labour market.

Job growth came in at 147,000 last month, beating expectations, and rising from an upwardly revised 144,000 figure in May.

“The much stronger nonfarm payrolls data means a July rate cut is now no longer in consideration, which is music to stock market bulls’ ears,” said City Index and FOREX. com analyst Fawad Razaqzada.

Wall Street’s main indices opened higher, the S&P 500 and Nasdaq Composite pushing up from record closes.

“But with the July 9 tariff deadline looming next week, can stocks retain their gains ahead of the long weekend?,” added Razaqzada.

US markets are closed on Friday for US Independence Day celebrations, but negotiators from several nations are racing to reach trade deals with Washington ahead of the deadline imposed by Trump.

Yesterday’s jobs numbers comes one day after a smaller survey showed the US private sector unexpectedly shed jobs last month for the first time since March 2023. That suggested that the US economy was beginning to be hit by the uncertainty caused by Trump’s trade war.