roaring lion

Good afternoon, stocks posted big gains on a great jobs report. Here’s what you need to know.

First the scoreboard:

Dow: 15,225.85, +185.23 pts,+1.23%

S&P500: 1,640.66, +18.10 pts, +1.12%

NASDAQ: 3,467.19, +43.13 pts, +1.26%

  • The U.S. added 175,000 non-farm payrolls in May, while the unemployment rate ticked higher to 7.6%, and the labour force participation rate 63.4%. Analysts had expected 163,000 payrolls. Our Joe Weisenthal said it was the perfect print for markets: more jobs added, but no major change in unemployment that would force the Fed’s hand on QE.
  • Manufacturing jobs saw their fourth-straight month of declines and have basically plateaued for the past year.
  • The jobs report caused Yen values to fall to as much as ¥97 against the dollar. Nikkei 225 futures also spiked on the release.
  • And the report sent gold and Treasuries downward. The yellow metal declined as much as -2.45%, while yields on the 10-year note swung up by 3.62%.   
  • Consumer credit expanded $11.06 billion in April, a 4.7% year-over-year gain, missing expectations. Economists were looking for a $12.9 billion advance.
  • Treasury bond funds saw their biggest outflows ever this week, as $2.6 billion, or 0.9% of assets under management, got turned over. Bond funds as a whole saw their second biggest weekly outflows since October 2008, with $12.5 billion in redemptions.
  • A spike in Shibor rates has people worried about a credit crunch in China. The overnight Shibor, or the Shanghai interbank offered rate, surged to 8.29% on June 7, from 5.98% on June 6. The seven-day Shibor rose to 6.66%, from 5.14%.
  • The Wall Street Journal reported George Soros is back in Japanese stocks. He’d sold off much of his position in May.
  • A major nuclear power plant in California will be decommissioned, which is likely to cause major headaches for south/southwest customers. Electricity prices had already gone up after the San Onofre’s operations were suspended last year.  
  • President Obama called reports of the continuation of the NSA’s vast phone data collection system “hype.” “Nobody’s listening to the content of people’s phone calls,” he said.
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