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How Did Markets Respond to April Jobs Data?

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Dec. 4 2020, Updated 3:53 p.m. ET

April jobs report

The jobs report plays an important role in market movement. After a weaker improvement in March, the labor market was expected to see some improvements in April. The ADP employment report and the US non-farm payroll report for April were released on May 2 and May 4, respectively.

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Impact on the economy and market

The jobs figures are important indicators for the central bank in regards to monetary policy decisions. An improvement in employment conditions is good for consumer activity. If wage growth also improves, then we could expect that consumer buying activity will also speed up, which could boost inflation. Higher inflation could prompt more interest rate hikes.

Non-farm payrolls for April 2018 showed a marginal improvement as compared to March. After the release of this report, the S&P 500 Index (SPY), the Dow Jones Industrial Average Index (DIA), and the NASDAQ Composite Index (QQQ) rose 1.3%, 1.4%, and 1.8%, respectively, on May 4.

In the rest of this series, we’ll look at the US non-farm payroll report and the ADP report for April in more detail.

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