This content was published on
August 7, 2026 - 15:00
5 minutes
(Bloomberg) — A sharp slowdown in the US jobs market drove stocks higher while bond yields fell on speculation the Federal Reserve won’t be forced to raise interest rates any time soon.Equities were poised to extend their advance for the week, with S&P 500 futures rising 0.5%. The yield on 10-year Treasuries declined six basis points to 4.62%. The dollar fell against all of its developed-world counterparts. Oil wavered as traders weighed negotiations over the Strait of Hormuz.US employers unexpectedly cut jobs in July and hiring in the prior two months was revised lower, suggesting the labor market is weaker than previously thought after surprising strength earlier this year.Nonfarm payrolls decreased 23,000 last month following a combined 103,000 downward revision to the May and June figures. The unemployment rate fell to 4.1% as labor force participation continued to slide.“While incoming inflation data will be the ultimate arbiter, slowing jobs growth helps support a September hold,” said Lindsay Rosner at Goldman Sachs Asset Management.Friday’s jobs report was not just much weaker-than-expected, it showed that the economy shed jobs during July, which puts the Federal Reserve in a conundrum, since inflation is still elevated and sticky, according to Brent Wilsey at Wilsey Asset Management.“While one weak jobs report is not likely to dictate Federal Reserve policy, we think the central bank will maintain its wait-and-see approach on interest rates, and allow more time to pass to examine incoming economic data,” he said.The jobs report is a game changer in the sense that all of the recent focus has been on inflation, with the latest numbers highlighting the risks that are embedded in the labor market as well, according to Chris Zaccarelli at Northlight Asset Management.“Before today, many were expecting that the Fed had no choice but to raise rates in order to fight stubbornly high inflation, because the job market was so strong, but this report shows that isn’t the case,” he said.While the weak payrolls print may ease the pressure on the Fed to raise rates at its September meeting, next week’s inflation data will still likely be the deciding factor, noted Ellen Zentner at Morgan Stanley Wealth Management.“If those numbers come in hotter than expected, a cooler labor market may not be enough to quiet the calls for hikes inside the Fed, or lower expectations outside of it,” she added.On the geopolitical front, President Donald Trump said negotiations between Iran and Oman over the Strait of Hormuz are “moving along,” though a deal has yet to be finalized amid suggestions the details are still being debated in Tehran.Corporate Highlights:Under Armour Inc. forecast a sharper revenue decline than previously expected as demand softens in several key regions. Sweetgreen Inc. cut its annual outlook after warning that diners are less willing to eat fresh prepared foods during the cyclospora outbreak. Wendy’s Co. withdrew its 2026 outlook and cut its dividend as its new chief executive devises a recovery plan for the beleaguered brand. Airbnb Inc. boosted its annual revenue forecast for a second time this year after it saw robust global travel demand, particularly in the US and Europe. DraftKings Inc. reported second-quarter sales and earnings that missed analysts expectations as the sportsbetting industry confronts a new challenge from prediction-market players. SK Hynix Inc. plans a 54 trillion won ($38 billion) expansion of its chipmaking facilities in South Korea, adding to efforts to rapidly double its production capacity and ease a global shortage of memory chips. Some of the main moves in markets:StocksS&P 500 futures rose 0.5% as of 9 a.m. New York time Nasdaq 100 futures rose 1.2% Futures on the Dow Jones Industrial Average rose 0.3% The Stoxx Europe 600 rose 0.7% The MSCI World Index rose 0.3% CurrenciesThe Bloomberg Dollar Spot Index fell 0.5% The euro rose 0.4% to $1.1572 The British pound rose 0.3% to $1.3499 The Japanese yen rose 0.7% to 157.36 per dollar CryptocurrenciesBitcoin rose 1.3% to $65,254.12 Ether rose 1.3% to $1,931.41 BondsThe yield on 10-year Treasuries declined six basis points to 4.62% Germany’s 10-year yield declined two basis points to 3.12% Britain’s 10-year yield declined three basis points to 4.91% The yield on 2-year Treasuries declined seven basis points to 4.17% The yield on 30-year Treasuries declined four basis points to 5.18% CommoditiesWest Texas Intermediate crude fell 0.8% to $76.71 a barrel Spot gold rose 2.9% to $4,360.35 an ounce ©2026 Bloomberg L.P.
