US Stocks Rally on Strong Jobs Data, Trump?s Big Beautiful Bill clears US Congress
U.S. non-farm payrolls rose by 147,000 in June, beating expectations, while unemployment fell to 4.1%. Traders reacted positively, though the strong data may delay Fed rate cuts. Market also eyed passing of President Donald Trump?s massive tax-cut and spending package by the US Congress. The Big, Beautiful' bill passed by a slim 218-214 margin, marking a major legislative win for the US President.
Positive sentiment may also have been generated in reaction to a report from the Institute for Supply Management showing the service sector returned to growth in the month of June. The ISM said its services PMI rose to 50.8 in June from 49.9 in May, with a reading above 50 indicating growth. Economists had expected the index to inch up to 50.5.
Networking stocks turned in some of the market's best performances, with the NYSE Arca Networking Index surging by 2.3% to a record closing high. Software stocks were considerably strong, as reflected by the 1.9% gain posted by the Dow Jones U.S. Software Index. Banking, retail and airline stocks also saw notable strength on the day, while housing stocks showed a significant move back to the downside.
Asia-Pacific stocks turned in a mixed performance. Japan's Nikkei 225 Index inched up by 0.1% and China's Shanghai Composite Index edged up by 0.2%, while Hong Kong's Hang Seng Index fell by 0.6%. The major European have all moved to the upside on the day while the French CAC 40 Index crept up by 0.6%, the U.K.'s FTSE 100 Index and the German DAX Index both climbed by 0.6%.
In the bond market, treasuries have seen continued weakness in reaction to the stronger than expected jobs data. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, has advanced 5.5 bps to 4.34%.
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