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In One Chart - June 4, 2018

In One Chart: Unemployment Hits 18-Year Low

Global markets continue to rise on Friday’s U.S. jobs data. Markets closed higher in the final session of last week after the U.S. Bureau of Labor Statistics reported more favorably than expected.

Particularly noteworthy was that unemployment dropped to 3.8% — an 18-year low for the U.S. Total nonfarm payrolls also increased by 223,000 in May — a marked uptick from the 159,000 jobs added in April.

In the past, lower unemployment numbers have led to mixed market performance as investors expect a higher U.S. Target Federal Funds Rate will follow. Even with the FOMC meeting next week, Wall Street took falling unemployment as a positive. Below you can see unemployment and nonfarm payrolls overlaid with the rising SPDR Consumer Discretionary ETF (XLY).

The strong U.S. jobs report also eased some investor worries surrounding U.S.-China trade negotiations. Investors worldwide hang in limbo as neither country has made a public statement following Sunday’s final round of trade negotiations in Beijing.

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