Post by LCG Associates, Inc.

Weekly Market Update: U.S. equities snapped their winning streak after nine consecutive weeks, the longest run since late 2023, with the NASDAQ losing 4.7%, the S&P 500 dropping 2.5%, and the Dow falling 0.2%. Labor market strength persisted in May, with job gains of 172,000 and upward revisions pushing the three-month average to 188,000, marking the strongest pace of hiring since early 2024 and reinforcing continued economic momentum. Bond markets resumed their sell-off following stronger-than-expected jobs data, pushing Treasury yields higher, particularly at the short end, as the 2 year yield jumped to 4.16% from 4.00%, reflecting increased expectations for tighter Fed policy. Markets are increasingly pricing in a Fed rate hike by year-end, with a ~72% probability of tightening versus minimal odds of a cut. Importantly, the expected magnitude spans a range from 25 to 75 basis points, indicating uncertainty around how aggressive the Fed may need to be, though the distribution still skewed toward at least a modest tightening rather than a large shift or easing. https://lnkd.in/dn_22Uh