Market Power | June 4, 2021

AUTHOR: Jason J. Roque, MS, CFP®, APMA®, AWMA®
TITLE:       Investment Adviser Rep – CCO
TAGS:   S&P 500, Oil, Inflation, Jobs, COVID

Markets charged back late in the week. This led to weekly gains, but does the market have staying power?


Memorial Day


The holiday lengthened weekend did not result in volatile markets Tuesday. The S&P 500 was virtually unchanged for the day. ISM Manufacturing improved more than expected, likely keeping markets calm as they wait for jobs data.


Wednesday’s market movement was muted, much like Tuesday. The S&P 500 gained 0.14% on the day. Market participants seemed as though they are waiting for the results of the monthly jobs report due out Friday.


Markets were more active on Thursday as data began to flow. Jobless claims fell below 400K for the first time since the start of the pandemic and services data jumped dramatically. While this was good news, the S&P 500 shed 16 points on what this could mean for the jobs report.


The May jobs report dropped on Friday morning, showing unemployment has fallen to 5.8%. More importantly only 492K private nonfarm payrolls were added in May. This was a ‘bad news is good news’ situation as the S&P 500 added 36 points on the day. The softer data eases concern over potential inflation.


The S&P 500 is with in 3 points of its all-time high set at the start of May. With earnings season behind us and economic data for May mostly out, it may be tough for the index to set record highs in the coming weeks as headline risk will carry more weight.

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