Unexpectedly strong US jobs report eases global economic tensions

The stronger-than-expected US jobs report for May 2025 helped ease global concerns about the state of the American economy, fuelling a broad rally in stock markets on Friday. The Dow Jones rose by 0.96%, the S&P 500 gained 1.01%, and the Nasdaq climbed 1.21%. Total nonfarm payroll employment increased by 139 00, while the unemployment rate remained unchanged at 4.20%. Steady job growth was recorded in sectors such as healthcare, leisure and hospitality, and social assistance. However, employment in the federal government continued to decline. Despite the upbeat labour market data, President Donald Trump renewed his call for the Federal Reserve to cut interest rates by a full percentage point. Tesla rebounded more than 3% after a steep 14% drop the previous day, as tensions between President Trump and CEO Elon Musk appeared to ease. The broader technology sector also performed strongly, with Nvidia, Meta Platforms and Apple all trading higher, contributing to the market’s overall momentum.

European stock markets ended the week on a positive note, with the STOXX 600 and London’s FTSE 100 both rising by 0.30%. Gains were driven by renewed optimism over US-China trade talks and investor response to the latest US jobs data. In currency markets, the euro weakened further below the $1.14 level on Friday, as the US employment figures renewed the dollar’s strength. In corporate news, the UBS shares climbed over 3% after the Swiss government proposed new capital rules aimed at bolstering financial stability. In contrast, Adidas and Puma shares declined, weighed down by Lululemon Athletica’s downgrade of its annual profit forecast.

Asian stock markets closed mixed, as investors balanced optimism from easing US-China trade tensions with lingering uncertainties. Japan’s Nikkei 225 rose 0.50% to 37 741.61 points, supported by positive sentiment. Meanwhile, China’s Shanghai Composite edged up slightly by 0.02%, reflecting cautious investor sentiment amid ongoing trade discussions. In contrast, Hong Kong’s Hang Seng Index slipped 0.38%, breaking its recent winning streak. 

South Africa’s stock market ended slightly lower on Friday, with the FTSE/JSE All Share Index dipping by 0.05% to close at 96 366.08 points. Despite the modest decline, the index remained close to its record high of 96 901.34 reached earlier in the month, signalling sustained investor confidence. By 19:24 SAST, the rand had weakened by 0.45%, trading at 17.79 to the US dollar. Market sentiment was shaped by a mix of global and local factors. The US jobs report lifted international investor optimism, providing some support to broader risk appetite. However, domestic corporate earnings painted a more mixed picture. Retailer Mr Price reported a 10.10% increase in full-year profits, driven by strong second-half sales and reduced markdowns, while The Foschini Group (TFG) posted a 4.60% rise in annual earnings, supported by a rebound in African sales and its recent acquisition of British clothing brand White Stuff. 

Commodities, Brent crude oil futures climbed above $66 per barrel, lifted by the US jobs report that eased economic concerns and improved the outlook for demand. Meanwhile, wildfires in Canada temporarily disrupted around 7% of the country's oil production, although recent rainfall helped bring the blazes under control. Gold, however, dropped by 0.14% closing at 3 330.04, while silver and platinum rose by 0.90% and 10.76%, respectively.