Wall Street ended mixed overnight, with the S&P 500 hitting another all-time high after President Donald Trump announced a new trade agreement with Vietnam. The deal includes a 20% tariff on Vietnamese imports and boosted investor sentiment despite fresh signs of economic softness.
The S&P 500 rose 0.47% to close at 6,227.42, while the Nasdaq gained 0.94% to finish at 20,393.13, both setting new record closes. The Dow Jones ended virtually flat, down just 10 points at 44,484.
Nike rallies, but jobs data disappoints
Shares of Nike surged 4%, as investors viewed the Vietnam deal as less damaging than feared. The company manufactures a large share of its footwear in both Vietnam and China.
But earlier in the day, markets wavered after a surprising decline in US private payrolls. ADP reported that the economy shed 33,000 jobs in June, the first monthly drop since March 2023. Economists had expected a gain of 100,000.
Fed rate cut back on the table?
Economists are now watching Friday’s jobs data closely. If government figures echo the ADP miss, some analysts believe the Fed could move to cut interest rates as early as this month. CFRA’s Sam Stovall noted that Fed Chair Jerome Powell has previously suggested that rate cuts would already be underway if not for Trump’s tariff push earlier this year.
Bond yields spike on fiscal concerns
US Treasury yields rose on Wednesday, with the 30-year yield climbing to 4.81%. The move mirrored sharp selling in UK bonds, where markets reacted to uncertainty around Chancellor Rachel Reeves and renewed concerns over the UK’s fiscal outlook.
Australian market
ASX futures are pointing 17 points lower, though Wall Street’s strength may help lift sentiment. In economic news, May trade data is due at 11:30am. However, investor attention is likely to shift later in the day to a slew of US economic releases scheduled for Thursday night, including the June non-farm payrolls report, weekly jobless claims, factory orders, and durable goods orders.
