From the Desk - Economic Commentary
Brandon Casey, Member Strategies - 7/3/2025
U.S. stocks are higher Thursday morning after a better-than-expected jobs report. Both the S&P 500 and Nasdaq reached new record highs in early trading. Markets now project there is a 93% chance the Fed will leave rates unchanged at the July FOMC meeting, up from 75% yesterday.
Looking at economic data today, nonfarm payrolls added 147,000 in June, well above expectations of 110,000. The unemployment rate fell one-tenth of a percent to 4.1%, versus expectations of increasing to 4.3%. Average hourly earnings were up 0.2% for the month, missing expectations, and rose 3.7% over the last year, down from 3.8% last month.
Initial jobless claims fell to 233,000, down from 237,000 the previous week. Initial claims were expected to increase to 240,000. Continuing claims were mostly unchanged at 1.964 million.
Wrapping up data, the U.S. trade deficit jumped 18.7% to $71.5 billion in May, in line with expectations. Imports were down 0.1% and exports fell 4.0%. Lastly, the ISM Services PMI increased to a reading of 50.8% in June, climbing out of contraction territory. Business activity and new orders expanded, while employment contracted.
U.S. Treasury yields are higher this morning, with the 2-year Treasury up 10.1 basis points to 3.89%, the 5-year Treasury yield up 7.6 basis points to 3.95%, and the 10-year Treasury yield up 5.7 basis points to 4.35%.
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