US stocks are making a push back to record territory following a very upbeat non-farm payroll report. Throughout the recent wrath of global growth concerns, the US labor market for the most part has been extremely robust. The February slowdown appears to be a one-off event as the March report showed 196,000 jobs were added, higher than the economists expected increase of 177,000 jobs. Wages remained strong at 3.2%, but down from the recent pace of 3.4% seen in February.
The impressive jobs report should alleviate recession concerns. While the President is making calls for the US to cut interest rates and to take further measures to stimulate the economy, today’s report should confirm the Fed’s patience and market participants may think it is unlikely that they will reconsider any changes in policy until after seeing second quarter data.
The S&P 500 index continues is now positive for a seventh consecutive day, the best streak in a couple of years.
Oil prices are also extending gains as a plethora of risk positive news keeps hitting the markets. The US economy’s labor market is very strong, optimism is high for China and US to reach a trade deal and OPEC + production has now fallen for a fourth consecutive month. Venezuela’s collapsing production due to electrical outages has also provided a nice backdrop for higher oil prices.
Brent took some time, but it finally cleared the $70 a barrel level, and if we don’t see US production reassert itself next week, we could see momentum traders try to keep the longest run of weekly gains since November 2017 going.