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The debt ceiling bill’s approval provided even another reason for the positive rally in stock futures.
In an exciting development, US stock futures have continued to soar as traders make meaning of the highly anticipated May jobs report and celebrated the passing of a debt ceiling bill by United States lawmakers.
According to reports, futures on the Dow Jones Industrial Average (INDEXDJX: .DJI) rose by 180 points or 0.5%. Similarly, futures connected to both the S&P 500 (INDEXSP: .INX) and Nasdaq 100 both rose by 0.5%. These bullish signs set the tone for a potentially good trading day, fueled by encouraging news from a variety of companies.
One notable performer in the Pre-market was Lululemon Athletica Inc (NASDAQ: LULU), a popular athletic apparel retailer. The company’s shares experienced a remarkable 15.57% increase as investors reacted positively to strong financial results.
Another standout was MongoDB Inc (NASDAQ: MDB), a leading modern, general-purpose database platform. The company’s shares soared by an impressive 31% hours following the announcement of a blowout forecast.
The excitement for the May jobs report was obvious. Investors have been watching employment data intently as an indicator of economic growth and stability. With the labor market still recovering from the consequences of the COVID-19 pandemic, any good indicators in job creation and unemployment data are welcome.
Notably, the May jobs report holds crucial implications for the Federal Reserve’s future policy decision. With the unemployment rate pegged at 3.7%, the report has provided valuable insights into the state of the labor market and is billed to potentially shape the Central Bank’s stance on interest rates.
Prior to the release, Economists surveyed by Dow Jones put forward their projections, indicating an expected easing in job growth for May compared to the previous month. The consensus suggests an addition of 190,000 jobs, a decline from the 253,000 gained in April. From the data released, a total of 339,000 jobs were added in the month of May, surpassing expectations.
US Stock Futures and the Debt Ceiling Bill
Meanwhile, the debt ceiling bill’s approval provided even another reason for the positive rally in stock futures.
Earlier in the week, there were fears that failure to reach an agreement on raising the debt ceiling could lead to a US default on its obligations, which had unsettled some investors. However, with the resolution of this issue, those concerns have been alleviated, leading to a sense of relief in the market.
Mona Mahajan, senior investment strategist at Edward Jones noted that the market had anticipated a settlement to the debt ceiling crisis. Furthermore, Mahajan revealed that the removal of this tail risk from the market equation has led to a collective sigh of relief. Moreover, she acknowledged that the limited economic impact expected from the debt ceiling fiasco and spending cap has contributed to the positive sentiment among investors.
Meanwhile, as the trading week nears its end, the S&P 500 and Nasdaq Composite (INDEXNASDAQ: .IXIC) are poised to register gains of approximately 0.4% and 1% respectively.