NEW YORK — U.S. stocks surged to unprecedented levels on Thursday, as a positive jobs report exceeded Wall Street’s expectations and bolstered market confidence.
The S&P 500 increased by 0.8%, reaching a new all-time high for the fourth time in five days. The Dow Jones Industrial Average also rose significantly, gaining 344 points, or 0.8%, while the Nasdaq composite improved by 1%.
Markets saw broad-based gains, with companies that thrive when consumer confidence is high leading the charge.
Expedia rose by 3.2%, and Norwegian Cruise Line advanced by 2.9%. Financial stocks also performed well, with Citigroup increasing by 2.3%, and JPMorgan Chase climbing by 1.9%.
The bond market exhibited a notable reaction to the government report indicating that employers added 147,000 more jobs than they cut last month.
This unexpected boost in hiring suggests the U.S. job market remains robust despite concerns about the economic effects of President Donald Trump’s tariffs and inflation. According to Carl Weinberg, chief economist at High Frequency Economics, there are no signs of an imminent recession based on current data.
Another report indicated a drop in the number of U.S. workers filing for unemployment benefits last week, reflecting decreased layoffs. In response, bond yields rose as investors speculated that the positive employment figures might deter the Federal Reserve from altering interest rates, contrary to Trump’s calls for rate cuts.
Traders in the futures market now assess less than a 5% probability that the Fed will reduce its main interest rate in the upcoming meeting, significantly down from a 24% likelihood seen just a day prior, according to CME Group data.
Federal Reserve Chairman Jerome Powell has maintained a cautious stance, preferring to observe how Trump’s tariffs might influence the economy and inflation before making any decisions. Though lower rates can stimulate economic growth by easing borrowing costs, they could simultaneously stoke inflation, which might already be rising due to the tariffs.
While several proposed import taxes remain temporarily halted, they could still go into effect soon unless Trump negotiates reductions with other countries. Many companies in the U.S. service sector express concerns over tariff impacts, despite a growth resurgence following May’s downturn, as per the Institute for Supply Management’s latest survey.
A respondent from the agriculture, forestry, fishing, and hunting industry noted that tariffs and their potential escalation are contributing to cost increases.
The 10-year Treasury yield climbed from 4.30% to 4.34%, while the two-year Treasury yield, closely tied to Fed expectations, increased more dramatically from 3.78% to 3.88%.
On Wall Street, Datadog surged 14.9%, boosted by news that its stock is set to join the S&P 500 index shortly. Index inclusion often attracts investment from fund managers matching or benchmarking against the S&P 500. Datadog will replace Juniper Networks, which has merged with Hewlett Packard Enterprise.
However, companies vulnerable to high-interest rates did not fare as well.
Homebuilders, who benefit from rate cuts that lower mortgage costs, experienced declines, with Lennar dropping 4.1% and D.R. Horton falling 2.7%.
Overall, the S&P 500 rose by 51.93 points to 6,279.35, the Dow Jones Industrial Average gained 344.11 to 44,828.53, and the Nasdaq composite climbed by 207.97 to 20,601.10.
Internationally, stock markets also saw upward trends, with indexes rising in both Europe and Asia.
South Korea’s Kospi increased by 1.3%, whereas Hong Kong’s Hang Seng decreased by 0.6%, marking two significant movements.