(The Closing Bell will be updated sometime after 4:00 PM CDST to include the latest updates from IBD and Bloomberg Evening Briefing.)
FYI: U.S. stocks stumbled after a better-than-expected June jobs report clouded expectations of an imminent interest-rate cut by the Federal Reserve.
All three major indexes fell from their records after new data showed U.S. employers hired at a robust pace in June. somewhat dashing investors’ expectations of an interest-rate cut at the Fed’s policy meeting later this month. A sustained slowdown in job growth could potentially nudge the central bank into taking steps that would have stoked further economic growth.
Instead, U.S. employers added 224,000 jobs last month, according to the Labor Department’s latest data, topping analysts’ projections as stock futures widened their losses ahead of the opening bell.
The Dow Jones Industrial Average fell 43 points, or 0.16%, to 26922, while the S&P 500 declined 0.18%. The Nasdaq Composite also fell, shedding 0.10%.
At the same time, U.S. Treasury yields rose as investors sold stocks and bonds simultaneously. The yield on the benchmark 10-year U.S. Treasury note rose to 2.046%, versus 1.965% just before the jobs report.
Investors who trade futures have placed a 98% chance of a rate cut at the Fed’s July meeting, according to CME Group data, a slight reduction in expectations following the release of June’s employment. There’s a roughly 2% chance now the central bank holds rates steady at the meeting, according to the data.
Still, major indexes like the Dow industrials and the S&P 500 remain up 15% and 19%, respectively, this year. Even though the most recent gains have been driven by expectations of an interest-rate cut, analysts said stock prices will likely ebb and flow over the next several weeks until the Fed offers further guidance on its plans later this month.
Trade tensions also remain in play and could give the Fed the justification it needs to cut interest rates, some analysts added. Although the U.S. and China have agreed to hold off on further tariffs indefinitely, the two sides still haven’t reached a final deal that would remove the levies already in place.
On Friday, interest-rate sensitive stocks led the market lower. Shares of utilities, consumer staples and real-estate firms all fell at least 0.7%. Industrial stocks also stumbled, shedding 0.8% in recent trading.
Financial stocks, meanwhile, notched a small gain, rising 0.3%, due to the move in bond yields. Higher rates usually allow banks to charge more for loans.
Elsewhere, stocks weakened in Europe Friday after a mixed session in Asia. The Stoxx Europe 600 slipped 0.7%, paring its gain for the week to 1.4%, its fifth straight week of gains.
Hong Kong’s Hang Seng slipped 0.1%, while the Shanghai Composite and Japan’s Nikkei both rose 0.2%, as all three ended the week up.
Regards,
Ted
Bloomberg Evening Briefing:
https://www.bloomberg.com/news/articles/2019-07-05/your-evening-briefingMarketWatch:
https://www.marketwatch.com/story/stock-markets-poised-for-a-pull-back-from-records-as-investors-await-friday-jobs-report-2019-07-05/printWSJ:
https://www.wsj.com/articles/global-stocks-waver-ahead-of-u-s-jobs-report-11562313342Bloomberg:
https://www.bloomberg.com/news/articles/2019-07-04/asia-stocks-set-for-muted-start-as-jobs-data-loom-markets-wrap?srnd=premiumIBD:
https://www.investors.com/market-trend/stock-market-today/stock-market-cuts-early-losses-after-strong-jobs-report-software-banks-take-lead/CNBC:
https://www.cnbc.com/2019/07/05/stock-market-us-markets-await-key-jobs-data.htmlReuters:
https://www.reuters.com/article/us-usa-stocks/wall-street-retreats-as-rate-cut-expectations-ease-idUSKCN1U0194U.K:
https://uk.reuters.com/article/uk-britain-stocks/ftse-100-slides-as-u-s-payrolls-dent-fed-rate-cut-hopes-idUKKCN1U00L6Europe:
https://www.reuters.com/article/us-europe-stocks/european-shares-retreat-from-12-month-highs-on-hexagon-outlook-dimmer-rate-cut-hopes-idUSKCN1U00N3Asia:
https://www.marketwatch.com/story/asian-stocks-fall-ahead-of-us-jobless-data-2019-07-05?mod=asia-marketsBonds:
https://www.cnbc.com/2019/07/05/bond-markets-treasury-yields-tick-lower-as-investors-await-key-jobs-data.htmlCurrencies:
https://www.cnbc.com/2019/07/05/oil-markets-global-economy-in-focus.htmlOil:
https://www.cnbc.com/2019/07/05/oil-markets-global-economy-in-focus.htmlGold:
https://www.cnbc.com/2019/07/05/gold-markets-us-jobs-data-in-focus.htmlWSJ: Markets At A Glance:
https://markets.wsj.com/usMajor ETFs % Change:
https://www.barchart.com/etfs-funds/etf-monitorSPDR's Sector Tracker:
http://www.sectorspdr.com/sectorspdr/tools/sector-trackerSPDR's Bloomberg Sector Performance Pie Chart:
https://www.bloomberg.com/markets/sectorsCurrent Futures:
https://finviz.com/futures.ashx 
