U.S. Indexes closed with extensive gains on Friday, as the tech-heavy NASDAQ 100 outperformed amid chunky gains in semiconductor names and the broad-based mega-caps. Intel had another positive catalyst, as it and Apple (AAPL) reached a preliminary chip-making agreement. As expected, while sectors were mixed, Tech was the clear gainer, with Utilities residing at the bottom of the breakdown. It was a broadly risk-on trade to end the week, and was helped by a stellar US jobs report, as the headline topped expectations, the Unemployment rate remained unchanged, and wages were cooler than expected. The Dollar was lower, to the benefit of G10 peers, with the Canadian Dollar the clear laggard on a dismal Canadian jobs report. WTI and Brent closed in the green, as participants now await Iran’s response to the US proposal, which is reportedly due to come at some point on Friday. Upside in oil prices was limited after Trump and the US military signalled strikes on Iran yesterday did not mean they sought escalation and that the ceasefire with Iran is still ongoing. Treasuries were firmer across the curve, whilst precious metals gained. Away from the US, both Sterling and Gilts were buoyed by a better-than-feared Labour performance in the local elections. Overall, we saw a strong US jobs report. The US economy added 115k jobs in April, above the 73k forecast but below the elevated 178k in March, which was revised up to 185k. Job gains were seen in healthcare, transportation and warehousing, and retail trade. Federal government employment continued to decline. The Unemployment rate was unchanged at 4.3%, in line with expectations. The participation rate dipped slightly to 61.8% from 61.9%, while the U-6 unemployment rate rose to 8.2% from 8%. On wages, earnings rose 0.2%, below the 0.3% forecast, maintaining the prior pace from March. The Y/Y rate, however, accelerated to 3.6% from 3.5%. For the Fed, the report allows the central bank to keep its focus on the inflation side of the mandate, particularly with ongoing upside risks around the US/Iran conflict. Looking ahead, however, many are aware of downside risks to employment, particularly if the war drags on and costs for businesses rise further. Pantheon Macroeconomics write that “Aprilʼs data bolster the case for thinking the labor market is convalescing. But the continued weakness of surveys of hiring intentions and the developing pressure on firmsʼ costs from the surge in energy prices suggests it is too soon to sound the all-clear.” The headline University of Michigan Consumer Sentiment Survey fell to 48.2 from 49.8 in the preliminary May report, below the expected 49.5. The decline was led by a drop in current conditions to 47.8 from 52.5, while forward-looking expectations edged up to 48.5 from 48.1. The drop in current conditions reflected concerns about high prices, both for personal finances and buying conditions for major purchases. The report also found that real income expectations continued a decline that began in March. It noted that one-third of consumers spontaneously mentioned gasoline prices, while about 30% mentioned tariffs. “Taken together, consumers continue to feel buffeted by cost pressures, led by soaring prices at the pump. Middle East developments are unlikely to meaningfully boost sentiment until supply disruptions have been fully resolved and energy prices fall.” On inflation expectations, year-ahead forecasts softened to 4.5% from 4.7%, while 5-year expectations declined to 3.4% from 3.5%. Elsewhere, Oil closed 0.64% higher while Gold was flat following a quiet trading session.
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For anyone following my Platinum Service it lost 435 points on Friday and is now down 303 points for May having ended April with a gain of 1730 points, after ending March with a massive gain of 9002 points, having closed February with a strong gain of 5482 points after ending January with a gain of 4757 points, having closed December with a gain of 2599 points, after ending the month of November with a gain of 4542 points, after ending October with a nice gain of 5110 points after closing September with a gain of 3774 points while ending August with a gain of 3362 points after closing July with a gain of 3753 points after closing June with a gain of 3530 points, having closed May with a gain of 3606 points, after closing April with a gain of 7685 points after closing March with a gain of 2254 points while closing February with a gain of 4180 points. January ended with a gain of 2768 points while 1997 points were gained in December. October ended with a gain of 2179 points, after closing September with a gain of 4402 points, following a loss of 301 points in August. July gained 1908 points while June saw a gain of 2074 points. The Platinum Service made a record 9619 points in October 2022. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 2300 points. I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
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