May Jobs Report On Target: Stocks Rise, Yields Jump

Summary

• The May jobs report was steady, with payrolls slightly above expectations and unemployment near cycle highs, signaling continued but modest labor market strength.
• Average hourly earnings rose more than forecast, providing a positive surprise amid otherwise mixed employment data and some concerning full-time job losses.
• Markets reacted positively: stocks rallied, especially small caps, while bond yields and the U.S. dollar climbed, reflecting relief that hard data remains resilient.
• With inflation data ahead and Fed rate cuts unlikely soon, I remain watchful for further signals but see no major shift in the economic outlook yet.

Marvin Samuel Tolentino Pineda

The May jobs report came in very close to expectations. The headline payrolls increase was 139,000 compared to a 126,000 consensus forecast. April’s employment gain was trimmed to 147,000, a 30,000 negative revision.

The unemployment

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