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Stock Market today: U.S. stocks edged higher on Thursday, driven by a surprisingly strong jobs report and fresh optimism around international trade deals. As the markets headed into a shortened session ahead of the July 4th holiday, investor sentiment stayed upbeat with all three major indexes posting gains. The S&P 500 and Nasdaq even extended their record highs, with the Dow Jones also not far behind.
Job numbers defy expectations, again
The big economic headline came from the June jobs report, which showed the U.S. economy added 147,000 jobs, well above expectations of 111,000. While federal government jobs declined, hiring in healthcare and state government sectors kept the labour market looking resilient. Meanwhile, the unemployment rate dipped slightly to 4.1%, and wages grew at a mild 0.2% pace, easing concerns about inflation. Jobless claims also fell to a six-week low, reinforcing the idea that layoffs remain under control.
Even more telling: the unemployment rate ticked down slightly to 4.1%, and wage growth stayed cool at just 0.2% month-over-month.
So, what does this mean? This clearly indicates the economy is working, inflation isn’t getting hotter, and the Fed just got a little more breathing room.
As Peter Cardillo, chief market economist at Spartan Capital, put it:
“The good news here is that hourly wages certainly are not getting out of hand. They’re subdued at 0.2% and cooler than expected on a yearly basis,”
All Eyes on the Fed, and Trump’s Tariffs
The Federal Reserve has been closely watching labour market signals, especially with inflation slowly cooling. Chair Jerome Powell has so far taken a cautious stance on interest rate cuts, but the latest data could open the door for potential rate reductions later this year. With four policy meetings left in 2025, markets are betting that lower borrowing costs might be in sight.
Meanwhile, concerns about Trump’s tariffs haven’t gone away, but recent trade moves are lifting some of that anxiety.
U.S.-Vietnam trade deal adds to diplomatic momentum
Trade developments also gave Wall Street a reason to celebrate. President Trump announced a new trade deal with Vietnam, marking the third major agreement in just weeks. The deal includes steep tariffs, 20% on most Vietnamese imports and 40% on rerouted goods, aimed at tightening trade flows ahead of Trump’s July 9 tariff deadline. This follows recent deals with China and Canada, and talks with India that appear to be close to wrapping up.
As part of the broader strategy, the U.S. Commerce Department also lifted export restrictions on chip design tech to China, suggesting some easing of tensions between the two global powers. Still, analysts expect the White House to maintain its aggressive tariff stance, with the effective U.S. tariff rate now sitting at a hefty 15%,a sixfold increase since the year began.
Trump’s mega Tax Bill inches forward
In Washington, Trump’s massive tax-cut and spending bill is gaining traction. The House advanced the bill on Thursday, following a narrow Senate pass earlier in the week. But the road ahead is contentious: the Congressional Budget Office warns the bill could add over $3 trillion to the national debt and strip nearly 12 million Americans of health insurance.
On the corporate front, Tripadvisor stock surged after reports revealed activist investor Starboard Value had acquired more than a 9% stake in the company, signalling potential boardroom changes ahead. Meanwhile, Datadog shares also climbed after the cloud software firm was announced as the newest addition to the S&P 500 index.
Oil Dips ahead of key OPEC+ decision
Oil prices took a slight dip following an unexpected rise in U.S. crude inventories. Brent and WTI futures both slipped ahead of this weekend’s OPEC+ meeting, where producers are expected to agree on a modest output hike of 411,000 barrels per day for August. The pause in price momentum follows a 3% jump on Wednesday, triggered by geopolitical jitters surrounding Iran.
Altogether, the market seems to be navigating a delicate balance of optimism and caution, welcoming strong economic indicators and trade progress, while still bracing for policy and geopolitical shifts in the weeks ahead.