US Jobs data beats expectations, yet unemployment rises
US Jobs data was released earlier today, offering better than expected results for the month of May. Analysts had originally predicted that 170,000 jobs would be created last month, with unemployment remaining little changed. However, those expectations were beaten by a clear 5,000, while unemployment unexpectedly rose by 0.1% to 7.6%.
During a period when positive data is being treated as bad news by traders, due to the ever increasing likelihood that the Federal Reserve will turn off the tap on its $85bn a month asset purchasing program, the markets were tense during early trading. An increase in new jobs would most certainly have been a strong sign of economic growth, giving the Federal Reserve’s potential move to halt their quantitative easing further support. However, once investors began to weigh the 0.1% rise in unemployment, the data began to look more promising for them.
Shortly before midday in London the FTSE 100, the UK’s leading blue chip benchmark, had slid to a low of 6,313.60 as investors across Europe waited with baited breath for the announcement. Once the data was released the FTSE began to climb steadily, reaching a peak of 6,421.19, leaving the index up by more than 1.3% for the day shortly before 4pm local time. The S&P 500 was preparing to open in New York with an rise of 10 points on the news. At the time of writing the S&P 500 had added to its opening gains, reaching 1,641.70 at 11:23am in new york — an advance of 1.1%.