US Treasuries Fall As Jobs Show Signs Of Resilience: Markets Wrap
Applications for US unemployment benefits fell for a sixth straight week, the longest stretch of declines since 2022.
Treasuries fell after data showed jobless claims hit the lowest since April, underscoring labor-market strength that’s keeping the Federal Reserve on hold. Stocks hovered near record highs amid a deluge of corporate earnings.
Benchmark 10-year yields climbed five basis points to 4.43%. Money markets showed a slight trimming in Fed rate-cut bets, with traders projecting less than two reductions this year. The S&P 500 barely budged, with Alphabet Inc. up and Tesla Inc. down after reporting results.
Applications for US unemployment benefits fell for a sixth straight week - the longest stretch of declines since 2022. The characterization of the labor market will also be a key feature of the Fed’s policy meeting next week.
To Bret Kenwell at eToro, while the labor market is not firing on all cylinders, it’s not showing signs of distress either. If next week’s jobs data give another reassuring nod to the labor market, investors may breathe a further sigh of relief, giving the Fed breathing room on policy.
“Today’s jobless claims total paints a familiar picture — there are still few signs of major cracks in the labor market,” said Chris Larkin at E*Trade from Morgan Stanley. “And if that picture remains intact, the Fed has one less reason to cut interest rates.”
Corporate Highlights:
Elon Musk warned of difficult times ahead for Tesla Inc. following one of the carmaker’s worst stretches since it first started producing electric sedans over a dozen years ago.
Alphabet Inc. said demand for artificial intelligence products boosted quarterly sales, and now requires an extreme increase in capital spending — heightening pressure on the company to justify the cost of keeping up in the AI race.
UnitedHealth Group Inc. is responding to criminal and civil requests from the US Department of Justice about its Medicare practices, the company said, confirming reports of probes that surfaced over the last two years.
International Business Machines Corp. reported weaker-than-expected sales in its closely watched software segment, disappointing investors who have grown increasingly optimistic about the business.
American Airlines Group Inc. scaled back its earnings outlook amid a persistent slump in consumer demand, casting doubt on a recovery in US travel.
Southwest Airlines Co. expects economic turmoil to erase as much as $1 billion of its annual pre-tax profit this year, prompting the US airline to offer shareholders a much-reduced outlook for 2025.
Dow Inc. slumped after the chemical company reported its first quarterly loss in five years as trade and tariff uncertainties weighed on volumes.
T-Mobile US Inc., the nation’s second-largest wireless provider, reported more new subscribers than analysts were expecting in the second quarter, overcoming a sluggish start to the year.
Chipotle Mexican Grill Inc. cut its annual outlook for the second time this year, suggesting that honey chicken and burrito giveaways haven’t been enough to offset a traffic slump that the company attributed to economic anxiety.
Blackstone Inc. reported a 25% jump in distributable earnings for the second quarter, buoyed by profits from its retail and evergreen funds.
American Eagle Outfitters Inc. jumped after the apparel retailer announced a campaign headlined by actress Sydney Sweeney.
ServiceNow Inc. gave a strong outlook for revenue growth and touted customer adoption of its artificial intelligence software tools.
Roche Holding AG is weighing direct-to-patient drug sales in the US, bypassing the middleman for its pricey medicines for multiple sclerosis, eye disease and cancer.
Some of the main moves in markets:
Stocks
The S&P 500 was little changed as of 9:32 a.m. New York time
The Nasdaq 100 rose 0.2%
The Dow Jones Industrial Average fell 0.7%
The Stoxx Europe 600 rose 0.1%
The MSCI World Index rose 0.3%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro was unchanged at $1.1771
The British pound fell 0.2% to $1.3550
The Japanese yen fell 0.1% to 146.68 per dollar
Cryptocurrencies
Bitcoin rose 0.6% to $118,641.58
Ether rose 2% to $3,641.57
Bonds
The yield on 10-year Treasuries advanced five basis points to 4.43%
Germany’s 10-year yield advanced seven basis points to 2.70%
Britain’s 10-year yield advanced two basis points to 4.66%
Commodities
West Texas Intermediate crude rose 0.9% to $65.83 a barrel
Spot gold fell 0.8% to $3,359.69 an ounce
