Better-than-expected job report shocks Fox’s Maria Bartiromo: “Wow, big beat! “
The Dow Jones and the S&P 500 exploded to record highs in the wake of a favorable jobs report in July – a pleasant surprise for economists who expect less-than-stellar numbers as the economy rebounds from the COVID-19 crisis.
The Labor Department reported a whopping 943,000 jobs added last month on Friday, putting the unemployment rate at its lowest since March 2020, just as lockdowns from the coronavirus pandemic began. Unemployment fell from 5.9% last month to 5.4%. These figures exceeded Bloomberg forecasts which predicted a job gain of 858,000, with the unemployment rate falling to 5.7%.
“This is exactly the kind of report the market wanted, in the sense that it is solid,” Seema Shah, chief strategist at Principal Global Investors, Recount Reuters. “This suggests that a labor market recovery is in play, but not so strong that it will push the Fed’s cutback schedule forward. These are golden loops, that perfect mix of strong but not too strong. strong. “
“I have not yet found a fault in this employment report”, echoed Harvard economist Jason Furman on Twitter. “I have never seen such a wonderful set of economic data. “
So encouraging that even Fox Business presenter Maria Bartiromo appeared stunned when reporting the news on Friday.
“Markets are flat ahead of jobs report, this is July’s employment support, we expect 870,000 jobs to be added to the economy,” Bartiromo told his viewers a few times. seconds before the report was released, as Mediate pointed out. But after hearing the numbers, Bartiromo admitted: “Wow, big beat!”
“Private sector payroll list 703,000, you have a number that is certainly boosting the markets here, Dow Industrial is peaking on this report. Up 72 points. The S&P 500 up six and a quarter.”
Certainly, experts have expressed concerns about the resurgence of COVID-19, which could potentially put the brakes on economic recovery.
“Sectors linked to the reopening of the labor market are leading the way, giving hope that these gains can continue in the months to come”, Nick Bunker, director of economic research at Indeed Hiring Lab, Recount The New York Times. “However, the Delta variant poses a risk to the pace of progress.”
CNN Noted that the hospitality and leisure industries – which effectively collapsed last year amid lockdowns and travel restrictions – mainly fueled the recent boom, accounting for more than a third of this month’s growth- this.
With the reopening of schools across the country, the education sector has also seen an increase in hiring, although the report’s numbers may be overestimated as layoffs in the sector were so common during the height of the pandemic.
Some experts said investors were actually hoping for an underperforming market, so the Federal Reserve would be less likely to start limiting support.
“The market actually wants a bad jobs report, as perverse as it sounds,” said Octavio Marenzi, CEO of Opimas. Recount Yahoo Finance Thursday afternoon, adding that investors wanted “the jobs numbers to be weak so that the Fed has a reason to continue its monetary policy.”
In March 2020, the Fed announced it would buy billions of corporate bonds using its emergency lending powers – a tactic used during the Great Recession. But in June of this year, the Fed revealed it would sell $ 13.7 billion in corporate debt, indicating that the market may no longer need to be supported by injections of liquidity. Federal Reserve Vice Chairman Richard Clarida appeared to confirm this direction this week, saying that it could support an interest rate hike if the economy continues to improve.
“I think those (…) conditions necessary to raise the target range for the federal funds rate will have been met by the end of 2022,” Clarida said this week.
Despite job growth, The Times reported that some hiring managers are still struggling to find candidates for positions. However, disgruntled employers have come under scrutiny for voicing these concerns amid nationwide demands for wage increases.