S&P 500 ended flat after shooting higher, then erasing gains and diving under water.
📊 Dow’s Fresh Record High
- Who knew that a poorly performing economy is actually good for stocks and their lofty valuations?
- The Dow Jones climbed 594 points, or 1.1%, on Thursday, finishing just shy of the 53,000 milestone and locking in its fourth straight weekly gain — its longest winning streak since 2024.
- The S&P 500 had quite the identity crisis. It surged after the open, gave it all back, briefly slipped into the red, and finished flat. The Nasdaq dropped 0.8% as chip stocks remained on the market’s bad side.
💼 Payrolls Miss, Fed Pressure Eases
- The June nonfarm payrolls report showed the US economy added 57,000 jobs, well below forecasts for 115,000. At first glance, that's a soft labor-market signal and another sign hiring is cooling after a strong run.
- The unemployment rate unexpectedly fell to 4.2%, but largely because more people exited the labor force rather than finding jobs. In other words, a lower unemployment rate isn't always a sign of a healthier economy.
- Traders interpreted the report as reducing the odds of Federal Reserve rate hikes this summer. Slower hiring can ease inflation pressure, giving policymakers less reason to keep tightening monetary policy.
🔄 Rotation Rolls Into Asia
- The market rotation away from AI favorites gathered steam again. Several Magnificent Seven names struggled, weighing on the tech-heavy benchmarks.
- Wall Street will be closed Friday for the Independence Day holiday, giving traders an extended weekend to digest a week packed with economic data, sector rotation, and enough chart swings to keep technical analysts busy.
- Asia picked up the baton on Friday. Japan's Nikkei 225 climbed 1.4%, the Topix gained 1.2%, and South Korea's Kospi rallied 4.7% as investors rotated back into broader equities after the recent technology shakeout.