The U.S. Jobless claims jumped to their highest level since October 2021

Unemployment rate

The U.S. Jobless claims jumped to their highest level since October 2021.

The S&P is only two basis points away from reaching a 20% rally, the highest increase since October 2022. The index has been really boosting market expectations over the past week. Boating other index gains, particularly technology stocks.

Large technology companies have entered the artificial intelligence sector, from individuals to high-value social media technology corporations.

Ever since, technology stocks have been lifting market gains, especially when other sectors are clearly in a recovery process that includes retailers, the housing market, and manufacturing activities.

Keeping with Wall Street’s main indexes, the S&P 500 benchmark roughly added 0.50% to a total of 4,291,90. And it’s more likely to hit a bull market any second today. The Nasdaq 100 composite rose by 1.11%, while the heavy tech Nasdaq was up by 0.93%. In today’s trading session, Alphabet Inc. was among the top decliners. The company’s stock price fell by 0.38%.

Shares of Amazon (AMZN) surged by nearly 3%, contributing to the overall upward movement of the technology sector. Analysts at UBS conveyed in a note to clients that Amazon’s advancements in artificial intelligence (AI) have the potential to significantly boost revenue for Amazon Web Services by the fourth quarter of this year. The positive sentiment surrounding Amazon’s AI initiatives has garnered attention from investors and analysts, highlighting the company’s growth prospects in the technology sector. As for Tesla shares, the company helped tech gains by rising by more than 4% this session alone.

Moving to the Dow Jones Industrial Average industrial futures, the index followed the same rising trend as its fellow indexes. The Dow rose by 0.45% to a total of 33.886.90 basis points.

On the other hand, there was an unexpected increase in U.S. jobless claims for the month of May.

Despite that, the market opened positively after reading the jobless claims report. The report showed signs of cooling in the labor market. Since last year and the end of the pandemic, the global labor market has been dealing with some strict and tight conditions. This in turn affects the economic recovery in the U.S.

Today’s reports show that U.S. jobless claims have risen higher than expected, to 261.000. The number was somehow surprising to the market, particularly when expectations were targeting an increase to 235.000. In the previous month, U.S. jobless claims rose to 233.00, which indicates that in a 30-day period, the labor market is cooling down. which complicates things a week before this month’s interest rate policy meeting.

As for the report, Jefferies comments on that in its note: “We remain of the view that the risk of a full-blown layoff cycle later in the summer remains substantial as businesses will look to cut costs and recapture more margin,

Meanwhile, U.S. Treasury yields have declined by an average of 2% for both 10-year and 30-year maturities. Treasury yields falling suggests that the interest rates on government bonds decreased. This decline in yields can be attributed to an increasing expectation among investors that the Federal Reserve will pause its monetary policy actions, particularly by keeping interest rates unchanged or making only minor adjustments.

Written by Editor

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