Closing Recap

U.S. stocks surged to fresh record highs, capping a strong week driven by a better-than-expected June jobs report and signs of easing trade tensions; the dollar and Treasury yields jumped as Fed rate cut bets were pared, while gold and oil prices slipped. 

Key Takeaways 

• S&P & Nasdaq Hit New Record Highs: Equities rallied broadly into the holiday weekend after a strong jobs report eased economic slowdown fears. 
• Strong June Jobs Report: Nonfarm Payrolls rose by 147,000, beating the 110K consensus, while the unemployment rate surprisingly fell to 4.1%. 
• Rate Cut Bets Dialed Back: The robust jobs data led traders to significantly reduce expectations for near-term Fed rate cuts, pushing the odds of a July cut to just 5%. 
• Sentiment Turns Bullish: Investor sentiment gauges (AAII, NAAIM) surged, showing a sharp increase in bullishness, a potential short-term contrarian signal. 
• Trade Backdrop Improves: Markets continue to be supported by the recent U.S.-China tariff pause and a new trade deal announced with Vietnam earlier in the week. 
• Dollar & Yields Spike: The U.S. dollar and Treasury yields rose sharply as the strong economic data lessened the case for imminent Fed easing. 
• Gold & Oil Slip: Gold prices fell as rate cut bets receded and the dollar strengthened. Oil prices also edged lower. 
• Strong Weekly & Monthly Performance: Major indices closed out a strong week and month, with the S&P 500 and Nasdaq posting their best monthly gains since November 2023. 

Market Overview 

U.S. equity markets put on a fireworks display ahead of the 4th of July holiday, with the S&P 500 and Nasdaq Composite surging to new all-time highs. The rally was ignited by a surprisingly strong June Nonfarm Payrolls report, which showed the U.S. economy added 147,000 jobs, handily beating expectations and calming recent fears of a sharp economic slowdown. The unemployment rate also unexpectedly ticked down to 4.1%. While some details were less robust (private sector growth was weaker, driven by government hiring), the headline numbers were enough to boost investor confidence significantly. Other economic data, including a rebound in the ISM Services PMI and a surge in May factory orders, also pointed to an improving economic picture. 

Index	Up/Down	% Change	Last
DJ Industrials	344.11	0.0077	44828
S&P 500	51.94	0.0083	6279
Nasdaq	207.97	0.0102	20601
Russell 2000	22.66	0.0102	2249

The positive economic data, combined with a backdrop of easing trade tensions following recent deals with China and Vietnam, has fueled a massive market rally over the past several weeks. The S&P 500 has surged over 25% from its April lows, with technology, industrials, and financials leading the charge. The strong jobs report had a significant impact on interest rate expectations; traders sharply dialed back bets for a July Fed rate cut and now see a more gradual easing path for the remainder of the year. This sent the U.S. dollar and Treasury yields jumping. 

Investor sentiment has also seen a dramatic shift, with the AAII bull-bear spread turning positive for the first time in weeks and the NAAIM Exposure Index surging to its highest level since December, potentially signaling “peaking” optimism from a contrarian perspective. Markets closed early today and will be closed tomorrow for the holiday.

Economic Data

Economic data yesterday was broadly stronger than expected, particularly the key jobs report, which eased recession fears. 

• Nonfarm Payrolls (June): +147,000 (Consensus: +110,000, Prior: +144,000). Private sector +74,000 (below +105k est.), Government +73,000. 
• Unemployment Rate (June): 4.1% (Consensus: 4.3%, Prior: 4.2%).
• Average Hourly Earnings (June): +0.2% m/m (below +0.3% est.), +3.7% y/y (below +3.9% est.). 
• Weekly Jobless Claims: Fell to 233,000 (6-week low), below the 240,000 consensus. 
• ISM Non-Manufacturing (Services) PMI (June): Increased to 50.8 (above 50.5 est., from 49.9 May), moving back into expansion. Prices Paid eased to 67.5. New Orders rebounded to 51.3. Employment fell to 47.2. 
• Factory Orders (May): Surged +8.2%, in line with consensus. 
• Trade Deficit (May): In-line with consensus at -$71.5 billion. 
• S&P Global US Services/Composite PMI (June Final): Composite 52.9 (vs. 52.8 flash), Services 52.9 (vs. 53.1 flash). 

Commodities, Currencies, and Treasuries 

Gold prices slipped, with August futures falling $15.80 to settle at $3,343.90 per ounce. The stronger-than-expected jobs report reduced the odds of near-term Fed rate cuts, diminishing gold’s appeal, while a stronger U.S. dollar also provided a headwind. Crude oil prices also edged lower, with WTI settling down $0.59 at $66.86/bbl in a quiet session ahead of the holiday. 

Asset	Up/Down	Unit / % Change	Last
WTI Crude	-0.59	USD/bbl	66.86
Brent	-0.47	USD/bbl	68.64
Gold	-15.8	USD/oz	3343.9
EUR/USD	-0.0047	USD	1.1751
USD/JPY	1.42	JPY	145.06
10-Year Note	0.049	%	0.04342

The U.S. dollar index spiked higher following the robust jobs report, as diminished rate cut expectations boosted the greenback’s attractiveness. The Euro and Yen both weakened against the dollar. Treasury yields jumped across the curve, with the 10-year yield rising about 5 basis points to 4.342% and the 2-year yield up 8 basis points, reflecting the market’s recalibration of Fed policy expectations.

Looking Ahead 

U.S. markets are closed tomorrow, Friday, July 4th, for the Independence Day holiday. Trading will resume on Monday. Investors will head into the long weekend celebrating a strong first half of the year and a robust jobs report. Looking ahead, focus will remain on trade developments, particularly as the July 9th tariff deadline approaches for some nations. Upcoming inflation data and the beginning of the Q2 earnings season will be the next major catalysts for the market.