US stocks jump as employers unexpectedly cut 23,000 jobs, raising hopes that rate hikes can wait

Key Points:

• Stocks rose on Wall Street with the S&P 500 hitting a new all-time high, driven largely by gains in technology stocks such as Nvidia and Broadcom, marking a strong start to August after several weak months.
• The U.S. government reported an unexpected loss of 23,000 jobs in July, leading Treasury yields to fall as investors anticipate the Federal Reserve may delay raising interest rates.
• The weaker jobs report, combined with downward revisions to May and June payrolls, complicates the Fed’s balancing act between supporting job growth and fighting inflation, with market expectations for September rate cuts decreasing.
• Corporate earnings for Q2 are showing strong growth, with nearly 90% of S&P 500 companies reporting and an overall profit growth forecast of 50%, helping to justify recent stock gains despite economic uncertainties.
• Rising oil prices, influenced by the ongoing U.S.-Iran conflict, continue to fuel inflation concerns, with Brent crude prices increasing and potential diplomatic efforts underway to reopen the Strait of Hormuz.