Job Market Flashes Red: Will the Rally Hold? 03/07/2025

HOT stories for today


 

US market wrap:

• U.S. stocks ended higher Wednesday despite a disappointing jobs report, with optimism fueled by a new U.S.-Vietnam trade deal. The S&P 500 rose 0.47% and the Nasdaq gained 0.94%, both closing at fresh record highs. The Dow Jones lagged, slipping 0.02%. President Trump’s announcement of tariffs on Vietnamese goods—including a 20% tax on direct imports and a 40% tax on rerouted goods—was seen as a strategic win for U.S. manufacturing.
• Meanwhile, a surprise 33,000 drop in ADP private payrolls raised concern over labor market softness but also reinforced expectations for Fed rate cuts. Yields eased, the dollar weakened slightly, and tech stocks led gains, while energy and materials benefited from trade-driven rotation.

Job Market Flashes Red: Will the Rally Hold?

• Markets are on edge ahead of Thursday’s nonfarm payrolls release after ADP’s data showed a surprising drop in private job growth. The miss sparked fresh political pressure, with President Trump intensifying criticism of Fed Chair Jerome Powell for not cutting rates sooner. Trump called for rates near 1%, well below the current 4.25–4.5%, and hinted at appointing a “shadow Fed chair” if needed.
• While bond yields have cooled slightly, they remain above spring lows, signaling markets aren’t fully buying recession fears yet. Still, the tone is shifting. If Thursday’s data disappoints, expect volatility and louder calls for intervention. The real test may not just be the numbers, but how the Fed and markets respond under rising political heat.

Stocks on the move:

• Reddit (RDDT): Shares surged nearly 4% after the company disclosed in a regulatory filing that it amended its credit facility agreement, extending the maturity date to 2030.
• Rigetti Computing (RGTI): The quantum computing firm advanced roughly 7% following a bullish initiation by Cantor Fitzgerald, which rated the stock "overweight."
• Robinhood (HOOD): Shares rallied 7% amid market speculation that the trading platform could be added to the S&P 500, following the official closure of Hewlett Packard Enterprise’s (HPE) acquisition of Juniper Networks (JNPR), which frees up a spot.
• Constellation Brands (STZ): The beverage company rose almost 4% after reaffirming its fiscal 2026 outlook, signaling confidence in meeting its targets despite softer quarterly results and new tariff pressures.

Watchlist: TSLA, META, AMZN, NVDA, RGTI, STZ, AVGO, HOOD

Today’s action

• Singapore’s STI hit a new high early Thursday, gaining 0.5% as sentiment improved on dovish Fed expectations. Japan’s Nikkei 225 edged up 0.6%, while South Korea’s Kospi dipped 0.3%. The Hang Seng Index fell 0.4%, dragged by tech names, and Australia’s ASX 200 rose 0.5% on mining strength. Investors across Asia remained cautiously optimistic ahead of key U.S. labor data and shifting central bank signals globally.
• U.S. stock futures point slightly higher, supported by lower yields and anticipation of Thursday’s labor data. Nasdaq futures led modest gains, as traders position for volatility tied to the nonfarm payrolls. 

Bitcoin

• Bitcoin (BTC) traded around $108,000 on Thursday morning, stabilizing after strong ETF inflows earlier in the week. While momentum cooled slightly after $340M in outflows on Tuesday, BTC remains resilient amid broader optimism over institutional adoption.
• Ethereum (ETH) hovered near $2,580, while Solana (SOL) found support above $146, boosted by interest in upcoming staking ETF products. Traders now watch U.S. CPI data and macro shifts for the next breakout cue.
  Watchlist: Bitcoin: 99,000 -112,000, Ethereum: 2,000-2,800, Solana: 140-183

Forex

• The U.S. Dollar Index (DXY) slipped just below 104.00, pressured by weak labor data and cooling Treasury yields. USD/JPY climbed to 161.50 amid renewed risk appetite and ongoing carry trade flows, though concerns over U.S.-Japan trade negotiations cap further gains .
• EUR/USD remains near 1.1800–1.1850, buoyed by weaker U.S. data and stronger Eurozone stats; markets anticipate a move toward 1.1830, with key expiries clustered around 1.1800
  Watchlist: EUR/USD: 1.1000–1.1850, USD/JPY: 150–162

Basic Materials

• Gold (XAU/USD) edged lower Thursday after touching a one-week high during the Asian session. A new U.S.-Vietnam trade deal reduced demand for safe-haven assets, while a mild uptick in the U.S. dollar added pressure. Still, the downside remains limited amid growing expectations for Fed rate cuts.
• WTI crude traded above $65.40, stabilizing amid rising tensions in the Middle East and anticipation around OPEC+ supply targets next week. U.S. stockpile data and hurricane season risks are also back on the radar.
  Watchlist: GOLD: 2,600–3,500, US Oil: 55.60–75.80

Economic Calendar (EST):

08:30 am: USD Non-Farm Employment Change
08:30 am: USD Unemployment Rate
08:30 am: USD Unemployment Claims
08:30 am: USD Trade Balance
09:45 am: USD Final Services PMI
10:00 am: USD ISM Services PMI
10:00 am: USD Factory Orders
11:00 am: USD FOMC Member Bostic Speaks

Earnings:

Today: No major earnings, Happy 4th of July!


The TEFS Analyst team wishes you a successful day!