John Hancock: Weekly Market Recap Week Ended June 3rd

Jobs consistency

The U.S. labor market’s long stretch of gains extended into May, as the economy generated 390,000 new jobs while the unemployment rate held steady at 3.6%. The monthly job gain was the smallest since April 2021; over the past 12 months, employers have added more than half a million jobs a month on average.

Bond reversal

After rising for three weeks in a row, prices of U.S. government bonds fell, sending yields sharply higher amid continuing concerns about persistent inflation and tightening monetary policy. The yield of the 10-year U.S. Treasury bond rose to 2.96% on Friday, up from 2.74% the previous week.

Lowering expectations

Wall Street analysts have recently been reducing their second-quarter earnings expectations. On average, analysts in April and May cut their forecasts by 1.3% for companies in the S&P 500, according to FactSet. Companies will begin releasing second-quarter results in mid-July.

Price check

A Consumer Price Index report scheduled to be released on Friday will show whether the U.S. economy got any relief in May from surging inflation. A month earlier, the government reported that inflation accelerated in April at an 8.3% annual rate—slightly below the previous month’s 8.5% figure, which was the highest since 1981.

Source: https://wmr.jhinvestments.com/