Payrolls: Dow Jumps 170 Points as All Work, No Pay Make Market a Happy Boy
Where did that come from? The 10-year Treasury yield is rising--and stocks with them--after the U.S. economy added more than 300,000 but worker pay rose less than expected.
U.S. payrolls added 313,000 job in February, blowing away estimates for 200,000, while the unemployment rate remained unchanged at 4.1%, above forecasts for 4%. Even more surprising: Average hourly wages rose just 0.15% from the previous month, well below estimates for 0.3%, and just 2.6% from a year ago, down from 2.8% in January. "It's possible that the rebound in the workweek put some downward pressure on average hourly earnings because salaried workers would have earned less per hour than they would have during the shorter workweek in January," writes Jefferie s economist Thomas Simons. "This is a very encouraging report."
The markets certainly think so. And they just love that combination of strong growth, as embodied by the payrolls increase, and muted inflation, as signaled by the lackluster wage growth. The 10-year Treasury yield has risen 0.035 percentage point to 2.9%. And this time stocks don't seem to mind. S&P 500 futures have gained 0.6%, while Dow Jones Industrial Average futures have risen 173 points, or 0.7%. Nasdaq Composite futures have climbed 0.7%.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.