Dow Jones slides 87 points after nonfarm payrolls data released

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NEW YORK, New York – Conflicting economic data kept buyers at bay on U.S. stock markets on Friday.

Nonfarm payrolls grew by 272,000 in May, significantly higher than the 165,000 in April, and well above the Dow Jones consensus estimate for 190,000.

The unemployment rate rose to 4 percent, a level not seen for 2 1/2 years.

Despite the headline number, employment continued to trend up in several industries, led by health care; government; leisure and hospitality; and professional, scientific, and technical services.

A full employment situation provided by the U.S. Bureau of Labor Statistics follows at the end of this article.

In summary, U.S. stock markets experienced a downtrend on Friday, with all major indices closing in the red. The S&P 500 and Dow Jones Industrial Average saw modest declines, while the NASDAQ Composite experienced a slightly larger drop.

S&P 500 The S&P 500 index closed at 5,346.99, down by 5.97 points, marking a decline of 0.11 percent, with a trading volume of 1.803 billion shares.

Dow Jones Industrial Average The Dow Jones Industrial Average ended the day at 38,798.99, falling by 87.18 points, reflecting a decrease of 0.22 percent, with a trading volume of 264.619 million shares.

NASDAQ Composite The NASDAQ Composite closed at 17,133.12, down by 40.00 points, registering a decline of 0.23 percent, with a trading volume of 4.24 billion shares.

World Foreign Exchange Market Summary for Friday – Demand for U.S. Dollar Leaps

T.h.e US dollar strengthened against most major currencies on Friday following the nonfarm payrolls report. The EUR/USD, GBP/USD, AUD/USD, and NZD/USD pairs all saw declines, while the USD/JPY, USD/CAD, and USD/CHF pairs experienced gains. The most notable changes were seen in the AUD/USD and NZD/USD pairs, both of which declined by over 1 percent.

EUR/USD (Euro/US Dollar) The EUR/USD pair closed at 1.0801, showing a decline of 0.79 percent for the euro.

USD/JPY (US Dollar/Japanese Yen) The USD/JPY pair ended the day at 156.68, reflecting an increase for the dollar against the Japanese yen of 0.70 percent.

USD/CAD (US Dollar/Canadian Dollar) The USD/CAD pair finished at 1.3754, with the greenback gaining 0.62 percent against the Canadian dollar.

GBP/USD (British Pound/US Dollar) The GBP/USD pair closed at 1.2722 Friday, down by 0.54 percent.

USD/CHF (US Dollar/Swiss Franc) The USD/CHF pair ended at 0.8963, marking a rise of 0.80 percent.

AUD/USD (Australian Dollar/US Dollar) The AUD/USD pair closed at 0.6582, showing a decline of 1.26 percent for the Australian dollar.

NZD/USD (New Zealand Dollar/US Dollar) The NZD/USD pair finished the day at 0.6106, with the New Zealand dollar down by 1.43 percent.

Global Stock Market Summary for Friday

CANADA

S&P/TSX Composite Index Canada’s S&P/TSX Composite Index finished at 22,007.00, down by 222.10 points, marking a significant decline of 1.00 percent, with a trading volume of 238.105 million shares.

UNITED KINGDOM

FTSE 100 The FTSE 100 index closed at 8,245.37, down by 39.97 points, marking a decline of 0.48 percent.

EUROPE

DAX PERFORMANCE-INDEX Germany’s DAX PERFORMANCE-INDEX ended the day at 18,557.27, falling by 95.40 points, a decrease of 0.51 percent.

CAC 40 The CAC 40 in France closed at 8,001.80, down by 38.32 points, which translates to a drop of 0.48 percent.

ESTX 50 PR.EUR The Euro Stoxx 50 index ended at 5,051.31 Friday, falling by 17.78 points, down by 0.35 percent.

Euronext 100 Index The Euronext 100 Index closed at 1,540.61, down by 5.92 points, reflecting a decline of 0.38 percent.

BEL 20 Belgium’s BEL 20 finished the day at 3,900.39, down by 16.58 points, a decrease of 0.42 percent.

ASIA

Nikkei 225 In Japan, the Nikkei 225 finished at 38,683.93, slightly down by 19.58 points, reflecting a minor decrease of 0.05 percent.

HANG SENG INDEX The Hang Seng Index in Hong Kong closed at 18,366.95, declining by 109.85 points, down by 0.59 percent.

SSE Composite Index China’s SSE Composite Index closed at 3,051.28 Friday, up by 2.48 points, indicating a slight increase of 0.08 percent.

Shenzhen Index The Shenzhen Index finished at 9,255.68, down by 84.33 points, registering a decrease of 0.90 percent.

STI Index Singapore’s STI Index closed almost flat at 3,330.77, with a negligible drop of 0.04 points, effectively unchanged at 0.00 percent.

S&P BSE SENSEX In India, the S&P BSE SENSEX closed at 76,693.36, significantly up by 1,618.85 points, a rise of 2.16 percent. NIFTY 50 India’s NIFTY 50 finished at 23,290.15, up by 468.75 points, marking an increase of 2.05 percent.

IDX COMPOSITE In Indonesia, IDX COMPOSITE on Friday finished at 6,897.95, down by 76.95 points, registering a decline of 1.10 percent.

FTSE Bursa Malaysia KLCI Malaysia’s FTSE Bursa Malaysia KLCI closed at 1,617.86, up by 3.13 points, indicating an increase of 0.19 percent.

KOSPI Composite Index In South Korea, the KOSPI Composite Index ended the session at 2,722.67, up by 33.17 points, gaining 1.23 percent.

TSEC weighted index Taiwan’s TSEC weighted index closed at 21,858.38, down by 44.32 points, reflecting a decline of 0.20 percent.

OCEANIA

S&P/ASX 200 In Australia, the S&P/ASX 200 ended the session at 7,860.00, gaining 38.20 points, up by 0.49 percent.

ALL ORDINARIES The Australian ALL ORDINARIES index ended at 8,112.80 Friday, up by 38.50 points, gaining 0.48 percent.

S&P/NZX 50 INDEX GROSS New Zealand’s S&P/NZX 50 INDEX GROSS closed at 11,856.56, down by 116.45 points, a decrease of 0.97 percent.

AFRICA

Top 40 USD Net TRI Index In South Africa, the Top 40 USD Net TRI Index closed at 4,012.28, down by 8.48 points, marking a decline of 0.21 percent.

MIDDLE EAST

Markets in the Middle East were mostly closed on Friday, and will reopen on Sunday.

In summary, the global markets showed a mix of gains and losses, mostly losses, with notable rises in the S&P BSE SENSEX and NIFTY 50.

Employment Situation Summary

MAY 2024 – Total nonfarm payroll employment increased by 272,000 in May, and the unemployment rate changed little at 4.0 percent, the U.S. Bureau of Labor Statistics reported Friday. Employment continued to trend up in several industries, led by health care; government; leisure and hospitality; and professional, scientific, and technical services. This news release presents statistics from two monthly surveys. The household survey measures labor force status, including unemployment, by demographic characteristics. The establishment survey measures nonfarm employment, hours, and earnings by industry.

Both the unemployment rate, at 4.0 percent, and the number of unemployed people, at 6.6 million, changed little in May. A year earlier, the jobless rate was 3.7 percent, and the number of unemployed people was 6.1 million.

Among the major worker groups, the unemployment rates for adult men (3.8 percent), adult women (3.4 percent), teenagers (12.3 percent), Whites (3.5 percent), Blacks (6.1 percent), Asians (3.1 percent), and Hispanics (5.0 percent) showed little or no change in May.

The number of long-term unemployed (those jobless for 27 weeks or more), at 1.4 million, changed little in May. The long-term unemployed accounted for 20.7 percent of all unemployed people. Both the labor force participation rate, at 62.5 percent, and the employment-population ratio, at 60.1 percent, were little changed in May. These measures showed little change over the year.The number of people employed part time for economic reasons, at 4.4 million, changed little in May. These individuals, who would have preferred full-time employment, were working part time because their hours had been reduced or they were unable to find full-time jobs.

In May, the number of people not in the labor force who currently want a job, at 5.7 million, was little changed. These individuals were not counted as unemployed because they were not actively looking for work during the 4 weeks preceding the survey or were unavailable to take a job. Among those not in the labor force who wanted a job, the number of people marginally attached to the labor force, at 1.5 million, was little changed in May. These individuals wanted and were available for work and had looked for a job sometime in the prior 12 months but had not looked for work in the 4 weeks preceding the survey. The number of discouraged workers, a subset of the marginally attached who believed that no jobs were available for them, edged up to 462,000 over the month.

Establishment Survey Data Total nonfarm payroll employment increased by 272,000 in May, higher than the average monthly gain of 232,000 over the prior 12 months. In May, employment continued to trend up in several industries, led by health care; government; leisure and hospitality; and professional, scientific, and technical services. Health care added 68,000 jobs in May, in line with the average monthly gain of 64,000 over the prior 12 months. In May, employment growth continued in ambulatory health care services (+43,000), hospitals (+15,000), and nursing and residential care facilities (+11,000). Government employment continued to trend up in May (+43,000), in line with the average monthly growth over the prior 12 months (+52,000). Employment in leisure and hospitality continued to trend up in May (+42,000), similar to the average monthly gain over the prior 12 months (+35,000). Employment in food services and drinking places continued to trend up over the month (+25,000). Professional, scientific, and technical services added 32,000 jobs in May, higher than the average monthly gain of 19,000 over the prior 12 months.

Over the month, employment increased in management, scientific, and technical consulting services (+14,000) and in architectural, engineering, and related services (+10,000). Specialized design services lost 3,000 jobs. Social assistance employment continued to trend up in May (+15,000), primarily in individual and family services (+11,000). Over the prior 12 months, social assistance had added an average of 22,000 jobs per month. In May, employment in retail trade continued to trend up (+13,000), about in line with the average monthly gain over the prior 12 months (+8,000). Building material and garden equipment and supplies dealers added 12,000 jobs in May, while job losses occurred in department stores (-5,000) and furniture and home furnishings retailers (-4,000). Employment showed little or no change over the month in other major industries, including mining, quarrying, and oil and gas extraction; construction; manufacturing; wholesale trade; transportation and warehousing; information; financial activities; and other services.

In May, average hourly earnings for all employees on private nonfarm payrolls increased by 14 cents, or 0.4 percent, to $34.91. Over the past 12 months, average hourly earnings have increased by 4.1 percent. In May, average hourly earnings of private-sector production and nonsupervisory employees increased by 14 cents, or 0.5 percent, to $29.99. The average workweek for all employees on private nonfarm payrolls remained at 34.3 hours in May. In manufacturing, the average workweek was unchanged at 40.1 hours, while overtime edged up to 3.0 hours. The average workweek for production and nonsupervisory employees on private nonfarm payrolls edged up by 0.1 hour to 33.8 hours.

The change in total nonfarm payroll employment for March was revised down by 5,000, from +315,000 to +310,000, and the change for April was revised down by 10,000, from +175,000 to +165,000. With these revisions, employment in March and April combined is 15,000 lower than previously reported. (Monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors.) (Report provided by U.S. Bureau of Labor Statistics, Friday 7 June 2024).