Stock Market Hits New Records as Strong Jobs Report Rattles Fed Rate Cut Hopes; 4 Stocks Break Out

NEW YORK – The Dow Jones Industrial Average and S&P 500 surged to record closing highs on Thursday, as investors cheered an unexpectedly strong June jobs report that painted a picture of a robust U.S. economy. The rally capped a shortened trading day ahead of the July Fourth holiday, with four key stocks breaking out to new buy points amidst the bullish sentiment.

The S&P 500 climbed 0.8% to a new record, while the tech-heavy Nasdaq Composite added 1%, also closing in record territory. The Dow Jones Industrial Average finished the day up 0.8%, or 344 points. Market breadth was overwhelmingly positive, with advancing stocks outnumbering decliners by more than two to one on both major exchanges.

Hot Jobs Data Cools Rate Cut Expectations

The market’s primary catalyst was the June jobs report, which significantly beat expectations. The Labor Department reported that nonfarm payrolls rose by 147,000, easily surpassing estimates of 110,000. The unemployment rate also dipped to 4.1%, confounding forecasts that it would rise to 4.3%.

While strong economic news fueled the stock rally, it simultaneously cast a shadow on the likelihood of near-term interest rate cuts from the Federal Reserve. According to the CME FedWatch Tool, the odds of a Fed rate cut in September fell from 72% to 67.5% immediately following the report.

Adding to the hawkish sentiment, Atlanta Fed President Raphael Bostic warned that the U.S. economy will likely face a “longer period of elevated inflation readings,” a process that he said could “take a year or more to fully play out.”

Market Breakouts and Key Movers

Amidst the broad rally, several individual stocks made decisive technical moves:

• Nextracker (NXT): The solar tracking software company broke out from a consolidation base, clearing a 63.19 buy point. The move was supported by a new high on its relative strength line, indicating it is outperforming the broader market.

• Cadence Design Systems (CDNS): The chip design software firm surged after news that U.S. export restrictions to China had been rescinded. The stock broke out from a base with a 326.19 buy point before pulling back slightly. Its peer, Synopsys (SNPS), also jumped on the news.

• ITT (ITT): The maker of engineered industrial components edged past a 161.13 buy point, signaling a potential new uptrend.

• Parker Hannifin (PH): The motion-control products manufacturer teased a breakout, moving toward a 718.44 buy point.

Other notable market movers included:

• Datadog (DDOG): Shares of the enterprise software company soared over 10% after S&P Global announced it would be added to the S&P 500 index on July 9.

• TripAdvisor (TRIP): The travel stock jumped more than 16% after activist investor Starboard Value disclosed a 9% stake in the company.

• Rivian (RIVN) and Lucid (LCID): The EV makers gained after reporting their quarterly delivery numbers, with Rivian reaffirming its full-year production outlook.