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US stocks popped on Thursday as investors digested a stronger-than-expected June jobs report that dampened hopes for a Federal Reserve interest-rate cut coming soon.
The S&P 500 (^GSPC) moved up about 0.7%, while the Nasdaq Composite (^IXIC) rose around 0.8%, after both indices closed at fresh record highs on Wednesday. The Dow Jones Industrial Average (^DJI) gained over 0.6%.
The jobs report showed an increase of 147,000 jobs added in June, versus expectations of 106,000. Meanwhile, the unemployment rate unexpectedly ticked down to 4.1%, and the May payrolls print was revised higher.
Recent signs of a softening in the labor market had given investors a new wave of confidence that a rate cut could come soon. But traders pared bets on rate cuts after the payrolls data, all but taking a July easing off the table.
Trump’s ongoing feud with its chair, Jerome Powell — particularly reports he may announce a successor early — has further buoyed hopes for a reduction in rates. The president said Powell “should resign immediately” in a social media post late Wednesday, ramping up an already intense White House pressure campaign.
Investors are also on alert for fresh developments on the trade front, as countries race to beat the July 9 deadline for the resumption of sweeping tariffs. Trump’s trade deal with Vietnam has boosted market sentiment and hopes for more agreements to fend off economic damage from tariffs.
Read more: The latest on Trump’s tariffs
The US has lifted curbs on exports of chip design software to China, a sign of thawing in trade tensions between the world’s top two economies. Shares of leading US providers of the software, Synopsys (SNPS) and Cadence Design Systems (CDNS), jumped in premarket trading.
Meanwhile, the president’s massive tax and spending bill is nearing a final vote after it cleared a key House procedural vote on Thursday. House Speaker Mike Johnson said he has the backing to get the legislation passed by Friday, July 4, Trump’s deadline, as Republican leaders win over opponents.
US stock trading will end early on Thursday at 1 p.m. ET for the Independence Day holiday and remain closed on Friday.
LIVE 12 updates
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Gas prices hit lowest level since 2021 ahead of July 4 holiday weekend
Gasoline prices hovered at their lowest level since 2021 heading into the July Fourth holiday, Yahoo Finance’s Ines Ferré reports.
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Meta climbs as analyst upgrades due to Facebook parent’s ‘strong labor productivity’
Meta (META) shares climbed 1.2%, leading the “Magnificent Seven” stocks higher along with Amazon (AMZN), after the Facebook parent’s stock was upgraded to Hold from an Underperform rating by Needham analyst Laura Martin.
Martin cited strength in Meta’s labor productivity, measured by free cash flow per full time employee.
“Our upgrade to Hold is driven by our latest labor productivity research that shows that META has had among the strongest labor productivity metrics for the past 4 years,” she wrote.
In its fiscal year 2024, Meta had a free cash flow of over $730,000 for every full time employee, followed by Apple’s $663,457, while the average for big cap companies covered by Martin was nearly $302,000.
Martin said she remained at a Hold rather than a Buy rating partly due to the “uncertain” return on Meta’s growing capital expenditures, which have been driven by its investments in AI. Martin said “the larger the spending the more likely there is waste, in our view.”
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Tech leads US stocks higher at the open
US stocks rose on Thursday morning after stronger-than-expected June jobs report that showed unemployment ticking down to 4.1%.
The S&P 500 (^GSPC) moved up about 0.4%, while the Nasdaq Composite (^IXIC) advanced 0.6%, after both indices closed at fresh record highs on Wednesday. The Dow Jones Industrial Average (^DJI) gained 0.3%.
Tech led the gains in stocks Thursday, with Meta (META) and Amazon (AMZN) leading the “Magnificent Seven” Big Tech stocks higher. Meta was up over 2% after an analyst at investing firm Needham upgraded the stock to Hold from Underperform, citing its “strong” labor productivity.
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Traders cut bets on a Fed rate cut in July
A stronger-than-expected June jobs report has traders scaling back bets on when the Federal Reserve will cut interest rates next.
Following the report, increasing bets on a July interest rate cut from the Fed reversed. Markets are now pricing in just a 5% chance the central bank lowers rates at its July meeting, down from a 24% chance seen a day prior, per the CME FedWatch Tool. Traders also grew more skeptical of a September move from the Fed, with markets now pricing in a 78% chance the Fed cuts by the end of its September meeting, down from a 94% chance seen a day prior.
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US labor market adds 147,000 jobs in June while unemployment falls to 4.1%
The June jobs report showed the US labor market remained more resilient than anticipated in the final month of the second quarter.
The US economy added 147,000 nonfarm payrolls in June, more than the 106,000 expected by economists. The unemployment rate unexpectedly fell to 4.1%. Economists had expected the unemployment rate to move higher, to 4.3%.
In May, the US economy added 144,000 jobs while the unemployment held flat at 4.2%. Those figures were revised higher on Friday from a previously reported 139,000 job additions in May.
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Investors are all smiles as ‘Liberation Day’ Part 2 looms
Yahoo Finance’s Hamza Shaban reports in today’s Morning Brief:
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Good morning. Here’s what’s happening today.
Earnings: No notable earnings releases.
Economic data: Nonfarm payrolls (June); Unemployment rate (June); Average hourly earnings; Average weekly hours worked (June); Labor force participation rate (June); Initial jobless claims (week ending June 28); Continuing claims (week ending May 24); Unit labor costs (first quarter final); S&P Global US Composite PMI (June final); ISM Services index (June); Federal Reserve Beige Book released; Durable goods orders (May final)
Here are some of the biggest stories you may have missed overnight and early this morning:
Investors are all smiles as ‘Liberation Day’ Part 2 looms
June jobs report on deck as Fed rate cut bets heat up
House vote moves Trump’s megabill toward final vote
US lifts chip design curbs on China in sign of thaw
OpenAI condemns Robinhood’s ‘OpenAI tokens’
Stock pickers shine, sniffing out value during market tumult
Trump aims to shut trade loopholes China uses to evade tariffs
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Trending tickers: Datadog, Robinhood and Tripadvisor
Here are some top stocks trending on Yahoo Finance in premarket trading:
Datadog, Inc. (DDOG) stock jumped 11% before the bell on Thursday after it was announced it would be joining the S&P 500. Datadog, which makes monitoring and analytic programs, will join the S&P 500 on July 9, replacing Juniper Networks, which was acquired by Hewlett Packard Enterprise.
Robinhood (HOOD) stock fell over 1% in premarket trading following OpenAI’s statement that Robinhood’s sale of “OpenAI tokens” will not give everyday consumers equity — or stock — in OpenAI, the company said in a post from its official newsroom account on X.
Tripadvisor (TRIP) stock rose 6% before the bell following a report that activist investor Starboard Value has taken a stake of more than 9% in the travel review group.
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US Treasurys join UK markets in rebound as Starmer backs finance minister Reeves
UK stocks and bonds bounced back from Wednesday’s sharp selloff as Keir Starmer said Rachel Reeves will retain her role as finance minister for many years to come.
The British prime minister was attempting to calm speculation about a possible exit of the chancellor of the Exchequer, after he failed to back a tearful Reeves in parliament on Wednesday.
The yield on 30-year UK bonds dropped 10 basis points to 5.32%, coming back from a 19 basis point jump on Wednesday. The FTSE 250, which lists UK-focused stocks, moved up 0.5%.
US Treasurys were also coming back after getting caught up in the UK gilt turmoil. The benchmark 10-year yield (^TNX) edged down roughly 2 basis points to 4.27% early on Thursday morning, while the 30-year yield (^TYX) slipped to around 4.79%.
Bloomberg reports:
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When does the stock market shut down for Independence Day?
US stock markets will close early on Thursday, July 3, and trading will end at 1 p.m. ET. They will stay shuttered on July 4 for the Independence Day holiday.
The stock market will reopen on Monday, July 7, at 9:30 a.m. ET.
After that, the remaining holidays in 2025 observed by the New York Stock Exchange and Nasdaq are:
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Synopsys and Cadence rise as US lifts chip software export curbs
Software companies Synopsys (SNPS) and Cadence (CDNS) rose in premarket trading by over 5% after the US removed export restrictions on chip design software shipments to China, easing trade tensions between the two countries. China recently made concessions over its rare earth export controls.
Synopsys, Cadence and Siemens said they will now restore access for their Chinese customers. These firms develop important electronic design automation tools used in chipmaking.
The US also lifted licensing rules for ethane producers. Earlier restrictions were part of Trump’s response to China blocking rare earth exports, which had disrupted supply chains for cars, aerospace and defence industries.
Reuters reports:
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Oil prices pull back from two week gain
Oil prices slipped after posting their strongest gain in nearly two weeks, as investors monitored ongoing US trade negotiations and an upcoming OPEC+ meeting this weekend.
Bloomberg reports:
Brent (BZ=F) traded near $69 a barrel after surging by 3% on Wednesday, with West Texas Intermediate (CL=F) above $67. President Donald Trump said he had struck a trade deal with Vietnam, which would be just the third announced following agreements with the UK and China, before a July 9 deadline to reach accords.
Crude has been buffeted in recent weeks, surging and collapsing along with perceived geopolitical risk in the Middle East, although volatility and volumes have fallen in recent days before Friday’s US holiday. Focus is returning to trade talks, and the associated tariffs that threaten oil demand, as well as to Sunday’s OPEC+ meeting, where the group is widely expected to agree on another bumper increase in supply quotas.
“While trade optimism provided a boost to oil prices, the sustainability of this move will likely be short-lived,” said Warren Patterson, head of commodities strategy for ING Groep NV. “OPEC+ is set to decide on August output levels this weekend, and so the market will probably be cautious about carrying too much risk into the US long weekend.”
