U.S. jobs drop fuels 0.5% Wall Street gain

Wall Street is set to open higher on Friday after two days of losses, with major index futures pointing to a rally. The S&P 500 futures are up 0.5%, regaining ground after slipping in previous sessions. The shift follows fresh labor market data that eased concerns about an imminent Federal Reserve interest rate hike.

The Labor Department reported that U.S. non-farm payrolls fell by 23,000 jobs in July, a sharp contrast to forecasts that expected an increase of 88,000. June’s gain was also revised downward to just 20,000 from an initial 57,000. While the jobs report signals some cooling in the labor market, it has reduced worries about aggressive Fed tightening in September. Treasury yields dropped sharply, with the 10-year note falling more than 1.2%, reflecting softer expectations for rate hikes.

The unemployment rate ticked down slightly to 4.1% from 4.2%, defying predictions it would remain flat. Stocks had struggled earlier in the week, with the Dow falling 464 points (0.9%) on Thursday, while the S&P 500 and Nasdaq slipped 0.2% and 0.1%, respectively. Overseas markets showed mixed results, with Asian indexes mostly lower but European markets climbing—Germany’s DAX gained 1%, the FTSE 100 rose 0.8%, and France’s CAC 40 added 0.5%.

Gold prices surged nearly $120 to $4,419 an ounce, reversing a $5.60 drop from the day before, while oil futures dipped slightly after a sharp rise on Thursday. The dollar weakened against the yen and euro, suggesting investors are recalibrating bets on monetary policy. If the jobs trend continues, it could keep rate hikes on hold, supporting equities. Traders are watching closely to see if Friday’s rally holds—or if the market’s recent volatility returns.