How the Wall Street rally extends as the market data optimism
The US stock markets locked in a second week of profits such as solid economic data and the potential flexibility of commercial tensions between the United States and China increased the confidence of investors, with all eyes now in the next decision of the Fed.
American markets extend the winning streak
The US stock markets joined on Friday, enclosing in a second consecutive week of profits, fed by strong economic data and the possible flexibility of commercial tensions between the United States and China.
For the week, the US Tech 100 increased by 3.45%, while Wall Street earned 1,207 points or 3%. The US 500 increased by 2.11% during the week, achieving its longest winning streak, the fine consecutive days, since 2004.
The job report exceeds expectations
The non -agricultural payroll report on Friday was robust since the main non -agricultural payrolls increased by 177,000 in April, compared to the 135,000 expected. The unemployment rate remained stable at 4.2% and would have fallen to 4.0% if it were not for the increase in the participation rate to 62.6% of 62.5%.
Resistant labor market data relieves concerns about an economic slowdown for now and reinforces confidence in the federal reserve capacity to keep the patient with policy settings. It remains to be seen if there will be a significant deterioration in the hard data, or if the recent decallation and the potential of “frame offers” prevent hard data from following the lowest soft data.
Key events in Focus this week
The attention this week will focus on possible tariff negotiations between the United States and China, and the decision of the Federal Reserve interest rate, forecast below. Investors will also closely see the profit reports of the first quarter of companies such as Ford, AMD, Walt Disney and Uber. Finally, the ISM PMI services are expected to fall to 50.2 from 50.8 to remain by little in expansion territory.
FOMC interest rate decision
Thursday, May 8 at 4.00 am
At the last FOMC meeting in mid -March, the FED maintained the Fed Fed Fund rate at 4.25%–4.50%, citing solid economic growth, under unemployment and slightly high inflation.
The Fed (DOT) projections showed that the members still expected to deliver two 25 -point rate cuts (BP) in 2025. Updated Fed forecasts, as expected, showed an increase in inflation and unemployment forecasts while reducing their GDP forecasts, reflecting the general impact of augmented rates.
The important reciprocal tariffs announced on the “Day of Liberation” have increased the fears of greater inflation and a slowdown in the labor market, testing both elements of the double mandate of the Fed.
As such, the Fed is expected to maintain the FED fund rate without changes this week at 4.25%-4.50%. The ongoing economic uncertainty is expected to emphasize, particularly due to the possible tariff effects and the need to keep the patient while waiting for more data. A summary of economic projections or the update of “plot of points” for this meeting is not due.
After the non -agricultural payroll report on Friday, the probability of a FED rate in June decreased to approximately 35% of around 55%. The July meeting has a total price for a 25 -PB rate cut with a cumulative 78 basic points of Fed fees with a year -end price.
FEEDED Fund Rate Graph
