Treasury yields, meanwhile, remained higher in the bond market after the Labor Department said U.S. employers added 130,000 jobs to their payrolls last month, more than the 75,000 economists had expected. That helped ease concerns from a day earlier, when a dispiriting report suggested that U.S. household spending, the main engine of the economy, may be grinding to a halt.On the one hand, strong employment data raises hopes that the U.S. economy can remain solid and continue to generate big profits for companies. For example, stocks in the energy and resources sector rose to some of the bigger gains in the S&P 500, and their gains tend to be closely tied to the health of the economy.
Exxon Mobil climbed 2.9%. Smurfit Westrock rose 12.1%, although the packaging company reported weaker profit for the latest quarter than analysts expected. It provided financial forecasts for the next five years that some analysts found encouraging.
But on the other hand, for the broad stock market, better-than-expected employment data could also keep the Federal Reserve on hold when it comes to rate cuts. And higher interest rates can affect prices for stocks and a variety of other investments.
After Wednesday’s report said U.S. unemployment fell last month, traders have scaled back their bets on when the Fed could start cutting interest rates again, data from CME Group showed. Most are still betting on at least two cuts before 2026. If Wednesday’s jobs report had shown a rise in unemployment or other deterioration in the labor market, that could have prompted the Fed to resume cuts more quickly.
Lower interest rates can boost the economy, but they can also worsen inflation. The next monthly update on US consumer inflation will come on Friday, which is also likely to have a major impact on the Fed’s plans.
After the jobs report, the yield on the 10-year government bond rose to 4.17% from 4.16% late Tuesday. Two-year government bond yields, which are more in line with expectations for Federal Reserve action, rose further. It rose from 3.45% to 3.51%.
To be fair, everything is still not entirely clear for the US economy. Wednesday’s report included major revisions, saying employers added just 181,000 jobs last year. That’s less than a third of the previously reported 584,000 and the weakest figure in a year since 2020, when COVID-19 shut down the economy.
Nevertheless, the overall employment report appeared to be an encouraging signal for the economy.
“We all knew there were going to be downward revisions, but they were better than expected,” Brian Jacobsen, chief economic strategist at Annex Wealth Management, said of the 2025 downgrades.
On Wall Street, Moderna fell 10.5% after saying the U.S. Food and Drug Administration is refusing to consider its application for a new flu vaccine made with Nobel Prize-winning mRNA technology. It’s the latest sign of the FDA’s increased oversight of vaccines under Health Secretary Robert F. Kennedy Jr.
Robinhood Markets fell 11.3%, although the trading and investing app reported stronger profits for the latest quarter than analysts expected. Revenue fell short of expectations, and analysts highlighted Robinhood’s 2026 spending forecast, along with concerns about how long a slowdown in crypto trading will last.
Crypto prices have fallen sharply lately, with Bitcoin’s price dropping to $66,000 on Wednesday. It has lost almost half its value since setting a record in October.
Kraft Heinz erased an early loss to rise 0.3% after CEO Steve Cahillane said he is pausing the company’s planned split into two companies in an effort to return the business to profitable growth. He also announced a $600 million investment in marketing, sales and research and development.
On foreign stock markets, indexes rose in much of Asia and Europe.
South Korea’s Kospi rose 1%, and Britain’s FTSE 100 gained 1% for two of the bigger moves.
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