Global stocks slipped slightly while the dollar strengthened on Tuesday after a U.S. payrolls review showed job growth was weaker than expected.
The U.S. Labor Department reported that the economy created 911,000 fewer jobs in the year through March than previously estimated. This suggests job growth slowed even before President Donald Trump’s tariffs took effect.
Gold, which hit record highs for the third straight day, pared some earlier gains. Investors expect the weaker jobs data to push the Federal Reserve closer to cutting interest rates this month. However, inflation data due later this week remains a key factor before the Fed’s policy meeting.
Michael James of Rosenblatt Securities said a sharp slowdown in labor growth supports the narrative for the Fed’s rate cut cycle to begin soon.
Rate Cut Bets Hold
Markets still see a 25 basis point cut as the most likely outcome, while chances for a larger 50 basis point move remain at around 10%, according to CME’s FedWatch tool.
On Wall Street, the Dow Jones rose 0.07%, while the S&P 500 slipped 0.10% and the Nasdaq fell 0.21%. Globally, MSCI’s equity index edged higher by 0.04%, while Europe’s STOXX 600 dipped 0.01%.
Political uncertainty also weighed on markets. In Europe, French President Emmanuel Macron began searching for his fifth prime minister in under two years after the collapse of François Bayrou’s government. Elsewhere, investors digested the resignation of Japan’s prime minister, an election setback for Argentina’s ruling party, and Indonesia’s sudden finance minister replacement.
Argentina’s main stock index, which dropped 13% on Monday, rebounded more than 2%. Emerging market stocks rose 1%, while Asia-Pacific shares gained 0.93%. Japan’s Nikkei slipped 0.42%.
Dollar and Bonds
The dollar index rose 0.17%, while the euro fell 0.24% to $1.1734. The dollar weakened 0.36% against the Japanese yen.
U.S. Treasury yields also moved higher, with the 10-year note rising to 4.07% and the 30-year bond yield climbing to 4.73%.
Commodities
Oil extended gains after Israel said it carried out an attack on Hamas leadership in Doha, Qatar. U.S. crude rose 1.69% to $63.31 per barrel, while Brent crude gained 1.61% to $67.08.
Gold continued its rally on expectations of Fed rate cuts. Spot gold rose 0.35% to $3,648.59 an ounce, after touching a record $3,673.95. U.S. gold futures also gained 0.2% to $3,645.50.
