Your Capital Markets Snapshot: US Markets Posted Strong Gains for the Week

Courtesy of Allen Davis, CFP®

US markets posted strong gains for the week, driven primarily by a weaker-than-expected July jobs report that reduced expectations for further Federal Reserve rate hikes, while optimism around a potential deal to reopen the Strait of Hormuz provided an additional tailwind for equities. The S&P 500 rose 3.6% for the week, reaching a record high on Friday, as technology mega-cap earnings results reinforced confidence in the AI investment cycle. Treasury yields declined across the curve as the soft payrolls data tempered concerns about the pace of economic growth and the likelihood of near-term Fed action. WTI crude oil fell approximately 7.7% on expectations that a potential Strait of Hormuz deal could restore meaningful oil supply to global markets. The July Nonfarm Payrolls report showed an unexpected decline of 23,000 jobs — the first monthly drop since February — and an unemployment rate that fell to 4.1% as labor force participation continued to slide, raising questions about the underlying strength of the labor market.