U.S. stocks accelerated after the U.S. Bureau of Labor Statistics released strong April employment data, and the Nasdaq Composite Index rose overall. With the unemployment rate holding steady at 4.3%, the April jobs report showed an increase of 115,000 jobs, higher than analysts’ expectations of 65,000. Job gains were primarily concentrated in the health care sector, but began to spread to other sectors, including pay increases in transportation, warehousing, and retail. Manufacturing employment declined, and federal employment continued to decline.
Job growth this year has been erratic. The March figure was revised upward by 7,000 to 185,000, a reversal from February’s newly revised 156,000 job losses and closer to the massive 160,000 jobs created in January. Additionally, average hourly wages were lower than expected in April’s employment report, increasing by 0.2% for the month and 3.6% on an annual basis, compared to expectations of 0.3% and 3.8%, respectively. The Nasdaq rose as much as 1.4% on Friday, while the S&P 500 rose 0.79%.
Despite Friday’s rise in jobs data, it was largely overshadowed by geopolitical events. Oil prices rose in after-hours trading on Thursday after military clashes broke out near the Strait of Hormuz. US benchmark West Texas Intermediate crude rose 0.4% after both the US and Iran accused each other of launching attacks in the region.
Investment experts welcomed the solid report, but noted concerns about the continued decline in the labor force. Chicago Fed President Austan Goolsby said in an interview on CNBC that the report shows the labor market has been “more or less stable for a year, year and a half.” “My characterization is that we’re stable, even if it’s not good. … The unemployment rate is stable, the employment rate is stable, the firing rate is stable, the vacancy rate is stable. So I don’t think there’s a lot of evidence yet that the job market is collapsing.”
Additionally, Scott Clemons, chief investment strategist at Brown Brothers Harriman, said the report is “evidence of the fundamental resilience of this economy and labor market, despite all the arrows of outrageous concerns about the Middle East, unemployment, inflation and the Fed.”
