Markets Rally on Strong Jobs Report and Easing Trade Tensions

Wall Street Extends Winning Streak

On May 2, 2025, U.S. stock markets continued their upward trajectory, buoyed by a robust April jobs report and signs of easing trade tensions between the United States and China. The S&P 500 closed higher for the ninth consecutive session, marking its longest winning streak since 2004.

April Jobs Report Surpasses Expectations

The U.S. Labor Department reported that nonfarm payrolls increased by 177,000 in April, exceeding economists’ forecasts. The unemployment rate held steady at 3.8%, and average hourly earnings rose by 0.3% month-over-month. These figures suggest that the labor market remains resilient despite recent economic headwinds .

Easing U.S.-China Trade Tensions

Investors were further encouraged by developments in U.S.-China trade relations. China announced exemptions on approximately $40 billion worth of American goods from tariffs, while the U.S. reciprocated by exempting about $102 billion worth of Chinese imports. Both nations expressed a willingness to engage in negotiations aimed at reducing tariffs, signaling a potential thaw in trade tensions.

Market Performance

• S&P 500: Closed at 5,456.90, up 0.15%
• Dow Jones Industrial Average: Closed at 40,608.45, up 0.13%
• Nasdaq Composite: Closed at 17,124.97, up 0.20%

The SPDR S&P 500 ETF Trust (SPY) rose to $566.76, while the Invesco QQQ Trust Series 1 (QQQ) increased to $488.83, reflecting the positive market sentiment.

Corporate Earnings Highlights

• Apple Inc. (AAPL): Shares dipped over 3% after CEO Tim Cook warned that tariff policies could cost the company $900 million, despite strong quarterly revenue and profit figures .
• Amazon.com Inc. (AMZN): Shares edged lower due to a weak Q2 profit outlook, even though Q1 results exceeded expectations with a 9% revenue increase .
• Reddit Inc.: Shares surged nearly 7% premarket after reporting a 60% jump in Q1 revenue and providing an optimistic Q2 forecast that exceeded consensus estimates .

Federal Reserve’s Stance

The Federal Reserve concluded its May meeting without changing interest rates, maintaining the benchmark rate at 5.25%. Chair Jerome Powell emphasized the need to monitor ongoing economic developments before making any significant policy shifts .

Conclusion

The combination of a strong jobs report and easing trade tensions contributed to the positive momentum in U.S. stock markets on May 2, 2025. Investors remain cautiously optimistic, closely watching upcoming economic indicators and corporate earnings reports to gauge the trajectory of the economy.