Market Drivers – US Session – 02/06/2023

Mohamed Abdelhamid 3 June, 2023 3:45 am Forex Market, Global Stock Market, Market Update

Dow jumped 700 points on the US hot jobs report as Nasdaq notched sixth straight winning week. The Dow Jones Industrial Average surged for its best day since January as traders cheered a strong jobs report and the passage of a debt ceiling bill that averts a US default.

shares popped more than 11% on strong results and a guidance boost, while MongoDB surged 28% on a blowout forecast.

Economic Data

Nonfarm payrolls grew much more than expected in May, rising 339,000. Economists polled by Dow Jones expected a relatively modest 190,000 increase. It marked the 29th straight month of positive job growth.

Recently, strong employment data had been pressuring stocks on the notion it would keep the Federal Reserve raising interest rates. But Friday’s data also showed average hourly earnings rose less than economists expected year over year, while the unemployment rate was higher than anticipated.

Both data points have given investors hope that the Fed could pause its interest rate hike campaign at the policy meeting later this month, according to Terry Sandven, chief equity strategist at U.S. Bank Wealth Management.

The CBOE Volatility Index — also known as Wall Street’s “fear gauge” as it approximates expectations for how much the S&P 500 will rise and fall in coming weeks — closed Friday at 14.60, its lowest since Feb. 19, 2020, shortly before the Covid pandemic closed the economy.

Key Developments

Easing concerns around the debt ceiling also helped sentiment. The Senate passed a bill to raise the debt ceiling late Thursday night, sending the bill to President Joe Biden’s desk. That comes after the House passed the Fiscal Responsibility Act on Wednesday, just days before the June 5 deadline set by U.S. Treasury Secretary Janet Yellen.

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