FX.co ★ Major Averages Posting Modest Gains In Afternoon Trading

**Market Summary:**

**Intraday Movements:**

After a morning of indecision, stocks are experiencing modest gains in Friday's afternoon trading. This upward movement has pushed the S&P 500 to a new intraday high.

**Current Index Levels:**

Although off their session highs, the major averages remain positive. The Dow is up by 78.74 points, or 0.2%, settling at 38,964.91. The Nasdaq has risen by 36.01 points, or 0.2%, to 17,209.13. Meanwhile, the S&P 500 is up 15.33 points, or 0.3%, at 5,368.29.

**Economic Data Impact:**

Today's modest gains on Wall Street follow the release of a closely monitored labor market report from the Labor Department. The report shows a surprisingly large increase in employment for May, although the unemployment rate also saw an unexpected rise.

**Employment Figures:**

Non-farm payroll employment surged by 272,000 jobs in May, significantly higher than April's upwardly revised 165,000 jobs. Economists had predicted an increase of about 185,000 jobs, compared to the initially reported 175,000 jobs for April.

**Wage Growth and Unemployment:**

The annual growth rate for average hourly earnings accelerated to 4.1% in May, up from 4.0% in April. However, the unemployment rate crept up from 3.9% in April to 4.0% in May, defying expectations of stability.

**Outlook and Analysis:**

This unexpected rise in the unemployment rate is the highest since January 2022. While the labor report tempers recent rate-cut optimism, it also eases concerns about economic strength. Quincy Krosby, Chief Global Strategist for LPL Financial, notes the importance of next week's CPI report in potentially shifting market sentiment and influencing future Fed policy.

**Sector Performance:**

**Gold Stocks:**

Despite broader market gains, gold stocks remain notably weak, with the NYSE Arca Gold Bugs Index plummeting 6.5%. This decline follows a steep drop in gold prices, with August futures falling $65.80 to $2,325.10 an ounce.

**Other Sectors:**

Interest rate-sensitive telecom stocks are also underperforming, as evidenced by the NYSE Arca North American Telecom Index's 1.8% decline. Steel, networking, and housing stocks have similarly moved lower, while pharmaceutical and banking stocks show some resilience.

**Global Markets:**

**Asia-Pacific:**

The Asia-Pacific stock markets had a mixed performance. Japan's Nikkei 225 Index edged down by 0.1%, Hong Kong's Hang Seng Index dropped 0.6%, while China's Shanghai Composite Index inched up 0.1%, and South Korea's Kospi surged 1.2%.

**Europe:**

Major European markets were broadly negative. Germany's DAX Index, France's CAC 40 Index, and the UK's FTSE 100 Index each fell by 0.5%.

**Bond Market:**

In response to the robust employment data, treasuries have declined sharply. The yield on the benchmark ten-year note, which moves inversely to its price, has risen by 14.3 basis points to 4.424%.