Stocks closed lower Thursday after strong jobs data got traders fretting once again about the specter of inflation.
With tomorrow’s monthly payrolls report on deck, today we learned weekly initial unemployment claims dropped below 400,000 for the first time since March 2020, an indication of a labor market on the mend. ADP’s own data puts May’s new-jobs number at 1 million, a figure well ahead of economists’ estimates.
Although April’s dismal numbers surprised and disappointed investors, the possibility of a red-hot May report tomorrow morning was enough to stoke inflation fears and, in turn, anxiety over interest rates.
“This morning’s economic data has rates moving higher,” writes Michael Reinking, senior market strategist at the New York Stock Exchange. “Just as the Street seemed to coalesce around the idea of another disappointing jobs number tomorrow, the ADP employment report came in at 1.5-times the Street estimate. Keep in…