U.S. Economy Adds Fewer Than Expected Jobs in September; Market Reacts Positively
The U.S. economy added only 29,000 jobs in September, far below the expected 84,000, and the unemployment rate rose to 4.2%. The Bureau of Labor Statistics also revised down job numbers for July and August by a combined 60,000. Despite these weak figures, stock markets responded positively as bond yields declined following the report. The drop in long-term Treasury yields provided much-needed relief after surging this year due to inflation concerns and economic uncertainty. The yield on the 10-year U.S. Treasury note fell by nearly 4 basis points to around 5.2%. This decline is significant because lower bond yields reduce discount rates used for valuing stocks, potentially boosting equity prices. The weak labor data has raised speculation that the Federal Reserve may reconsider its tightening stance if job growth continues to slow. The odds of a rate hold at the Fed’s October meeting have increased sharply in response.
Tickers: $SPX
Topics: Bond Yields Nonfarm Payrolls Stock Market Reaction Unemployment Rate