U.S. Stocks Unchanged After Payrolls as Real Estate Shares Climb

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The Workforce Participation Mystery of U.S. Labor

U.S. stocks were little changed following monthly payrolls data that fell short of expectations.

The S&P 500 was up less than 0.1 percent to 2,430 at 10 a.m. in New York. The benchmark surged 0.8 percent on Thursday, hitting a fresh record high. The Dow Jones Industrial Average added 6 to 21,149.

  • Real estate and telecom shares lead the market in early trading, up at least 0.4%
  • 10-year Treasury Yield down 4bps
  • Energy shares retreat amid a renewed drop in oil prices, with WTI down 1.7%
    • Crude futures dropping below $47 a barrel as U.S. supply data signaled that OPEC’s efforts to re-balance oversupplied markets need more time
  • U.S. equity funds saw $7.5 billion in investment flows in the week ended May 31, the most in five weeks, BofAML strategists wrote in a note, citing EPFR Global data, with inflows into the tech, financials, utilities, materials sectors and outflows from the energy, health care, consumer, real estate sectors
  • POLITICS:
    • On Wall Street, corporate executives pilloried President Trump after his decision to leave the Paris climate accord: Goldman Sachs’ CEO, in tweet, called the move a setback for the world; Tesla Inc.’s Elon Musk and Bob Iger of Walt Disney Co. quit a White House advisory council in protest
  • ECONOMY:
    • Payrolls rose 138k (est. 182k rise); March-April revisions subtracted 66k jobs
    • Unemployment rate, derived from a separate survey of households, fell to 4.3% (est. 4.4%) from 4.4%
    • Average hourly earnings rose by 0.2% m/m (matching est.); climbed 2.5% y/y (est. 2.6%)
  • EARNINGS: none

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