Closing Recap

U.S. stocks finished mostly higher in a choppy session, with the Dow and S&P 500 gaining while small caps lagged, as investors digested a massive downward revision to U.S. jobs data which solidified Fed rate cut hopes; gold hit another record, oil rallied on Mideast tensions, while the dollar reversed to finish higher. 

In the currency markets, the U.S. dollar experienced a volatile session, initially tumbling to a seven-week low on the jobs data before staging a sharp rebound to close higher. This reversal pressured the Euro, pushing EUR/USD down to the 1.1706 level after it had touched multi-week highs earlier, while the Japanese Yen showed some resilience against the greenback’s late-day strength.

Key Takeaways 

• Stocks Choppy After Massive Jobs Revision: Equities navigated a volatile session after the BLS announced a stunning downward revision of 911,000 jobs for the year through March 2025, confirming a much weaker labor market. 
• Rate Cut Hopes Solidified: The weak jobs revision cemented expectations for a Federal Reserve rate cut at next week’s meeting and potentially more aggressive easing in the coming months. 
• Apple Event in Focus: Markets were also focused on Apple’s (AAPL) annual product event, where new iPhones, AirPods, and Apple Watches were introduced. 
• Gold Hits New All-Time High: Gold prices surged to another new record high, benefiting from increased Fed rate cut bets and ongoing safe-haven demand. 
• Oil Rallies on Geopolitical Tensions: Crude oil prices gained after an Israeli attack on Hamas leadership in Doha escalated tensions in the Middle East. 
• Currencies: The U.S. dollar reversed sharp early losses to finish higher against the Euro and Yen, while Treasury yields saw a modest bounce after recent declines. 
• M&A and Earnings Activity: Several large M&A deals and earnings from Oracle (ORCL) after the bell provided company-specific catalysts. 
• Cryptocurrencies: Bitcoin faced downward pressure, dropping below $111,000 following the shocking U.S. employment data revision.

Market Overview

U.S. equity markets experienced a choppy but ultimately positive day, with major averages recovering from early weakness to finish mostly in the green. The session was dominated by a shocking preliminary benchmark revision from the Bureau of Labor Statistics (BLS), which indicated that the U.S. economy created 911,000 fewer jobs in the 12 months through March 2025 than previously reported. This massive downward revision confirmed that job growth was already stalling significantly before the recent tariff escalations, providing powerful ammunition for the Federal Reserve to cut interest rates. 

Index	Up/Down	% Change	Last
DJ Industrials	196.64	0.0043	45711
S&P 500	17.52	0.0027	6512
Nasdaq	80.79	0.0037	21879
Russell 2000	-13.07	-0.0055	2381

The market reaction to the jobs data was initially volatile, with stock futures and the dollar dipping. However, as the session progressed, the “bad news is good news” narrative took hold, with investors embracing the increased probability of more aggressive Fed easing. The S&P 500 and Dow finished with solid gains, while the Nasdaq was more subdued. Defensive sectors like Utilities and Communications led the advance, while cyclicals such as Industrials and Materials lagged. 

In other news, Apple’s (AAPL) annual product launch event was a key focus, with the company unveiling its new iPhone 17 and updated AirPods and Apple Watches. Geopolitical tensions in the Middle East also flared after an Israeli military attack on Hamas leadership in Qatar, which provided a significant boost to oil prices. Investors are now looking ahead to earnings from Oracle (ORCL) after the close and key U.S. inflation data (PPI and CPI) over the next two days.

Economic Calendar

The main economic event yesterday was the BLS’s preliminary benchmark revision to payroll data, which was a significant market mover.

• BLS Jobs Revision (Prelim): Downward revision of 911,000 jobs for the 12 months through March 2025. This lowers average monthly gains to ~63K from ~146K for that period.

Today key risk events:

• SNB Chairman Schlegel Speech
• U.S. Producer Price Index (PPI) for August: PPI m/m (est. +0.3%, prior +0.9%)
• Core PPI m/m (est. +0.3%, prior +0.9%)

Thursday’s risk events:

• U.S. Consumer Price Index (CPI) for August (Thursday): CPI m/m (est. +0.3%, prior +0.2%) 
• Core CPI m/m (est. +0.3%, prior +0.3%) 
• CPI y/y (est. +2.9%, prior +2.7%) 
• Core CPI y/y (est. +3.1%, prior +3.1%)

Commodities, Currencies, and Treasuries 

December gold prices rose $4.80 or 0.13% to settle at $3,682.20 an ounce (off earlier record highs $3,715.20). Data showed The People’s Bank of China increased its gold holdings for the 10th straight month. Continued strength in precious metals. Gold prices rose on Wednesday, holding above the critical $3,600-per-ounce level, buoyed by expectations of a U.S. interest rate cut this month, while key inflation reports due this week were also on investors’ radar. Elsewhere, spot silver rose 0.6% to $41.14 per ounce. Platinum gained 1.1% to $1,383.90 and palladium was flat at $1,147.98. 

Oil prices rose after the Israeli military said it carried out an attack on Hamas leadership in Qatari capital Doha in an escalation of the conflict in the region. U.S. WTI crude oil futures settle at $62.63/bbl, up 37 cents, or 0.59% but pulled back off earlier highs while Brent gained $0.37 to settle at $66.39 per barrel. Nymex natural gas settles up 0.9% at $3.117/mmBtu. 

Asset	Up/Down	Unit / % Change	Last
WTI Crude	0.37	USD/bbl	62.63
Brent	0.27	USD/bbl	66.39
Gold	4.8	USD/oz	3682.2
EUR/USD	-0.0056	USD	1.1706
USD/JPY	-0.09	JPY	147.41
10-Year Note	0.036	%	0.04079

The U.S. Treasury sold $58B in 3-year notes at high yield 3.485%, below the 3.492% when issued prior, with bid-to-cover ratio 2.73, as primary dealers take 8.37% of U.S. 3-year notes sale, direct 17.39% and indirect 74.24% (2nd highest reading on record). After tumbling in recent days, Treasury yields saw a modest bounce today with the 10-yr +3bps to 4.076% and the 2-yr +5bps to 3.54%. 

In the currency markets, the U.S. dollar index (DXY) was the center of attention, executing a dramatic intraday reversal. After hitting a seven-week low of 97.25 this morning on the back of the weak jobs revision, the DXY rallied throughout the day to finish near its best levels around 97.80. This whipsaw action saw the EUR/USD touch its strongest level since late July near 1.178 before fading to close around 1.1706. The Japanese Yen initially strengthened against the dollar on the data, with USD/JPY dipping, before the dollar’s recovery pared some of the Yen’s gains. The British Pound also experienced significant volatility but held some of its earlier strength.

Looking Ahead 

The market will continue to digest the implications of the massive jobs data revision and its impact on the Federal Reserve’s policy outlook. Key U.S. inflation reports are due this week, with the Producer Price Index (PPI) today and the Consumer Price Index (CPI) on Thursday, which will be the next major catalysts. Oracle’s earnings report after the close tonight will be important for the software and tech sectors. Any further developments in the Middle East could also inject fresh volatility, particularly in energy markets.