The Fed has been insistent that it sees inflation coming down slowly, which would mean rates would stay high for a while, if not rise further if inflation were to reaccelerate. After that is where expectations diverge. Many traders expect the Fed to hold rates steady at its next meeting in June, which would be the first time that’s happened in more than a year. It’s been raising rates at the fastest pace in decades to drive down inflation, but that works by slowing the economy and hurting investment prices.
The Fed on Wednesday said that it wasn’t sure of its next move after raising its benchmark rate to a range of 5% to 5.25%, up from virtually zero early last year. In the bond market, yields leaped immediately after the jobs report as traders bet on it pushing the Fed to keep rates high for longer than earlier expected. It’s a contrast to competitor Uber, which rose solidly for the week following its earnings report. On the losing end was Lyft, which slumped 19.3% after it gave a weaker financial forecast for the current quarter than Wall Street expected. Live Nation Entertainment jumped 15% after reporting a more modest loss than analysts expected, while Cigna Group rose 7% after topping forecasts for profit and revenue. The worry is falling stock prices for banks could create a vicious cycle that causes customers to lose faith and pull their deposits, which then raises more fear for the system. jumped 49.2% to trim its loss for the week to 26.8%. soared 81.7%, though it still lost 43.3% for the week. Several of the hardest hit recovered some of their steep losses Friday, adding to the ebullient mood. That’s even as banks protested that they were seeing deposit levels stabilize or strengthen.
Investors have been hunting for the next possible weak link in the system and driving down stock prices for those seen at risk of a sudden exodus by customers. This week began with regulators seizing First Republic Bank, which became the third large U.S. banking system, and fears about what may be next to fall have rocked the industry. High interest rates have already caused cracks in the U.S. “Today’s jobs report likely gave both the bulls and the bears something to anchor around,” he said. Will Biden's hard-hat environmentalism bridge the divide on clean energy future? That in turn would keep the pressure up on an already slowing economy. While that’s good news, particularly when many economists fear a recession may arrive this year, the data also raises worries inflation may stay high and push the Federal Reserve to keep interest rates higher. government’s jobs report also showed workers won bigger pay raises in April than expected. Treasury yields jumped in the bond market after a report showed hiring accelerated across the economy by much more than expected last month. The Dow Jones Industrial Average climbed 546 points, or 1.7%, while the Nasdaq composite rallied 2.2%.
The S&P 500 jumped 1.8%, though it still turned in a modest loss for the week that was its worst in nearly two months. Stocks of beaten-down banks also leapt to recover a smidgen of their sharp losses from a brutal week. NEW YORK (AP) - Apple was at the head of a widespread rally on Wall Street Friday after the market’s most influential company reported a better profit than expected.
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