The US economy added 162,000 nonfarm payrolls in August, the strongest monthly gain in five months and roughly three times what Wall Street had forecast. The unemployment rate held at 4.1%. Job growth was concentrated in food services, drinking places, and local government education, while the information sector shed positions.
A hotter-than-expected jobs report gives the Federal Reserve cover to raise interest rates, and rate hikes push bond yields up while compressing the valuations of equities, especially growth stocks. S&P 500 futures fell on the release, signaling that investors are repricing the probability of tighter monetary policy this month.
Federal Reserve rate decision: expected later in September. Next nonfarm payrolls report: early October.
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