The S&P 500 Index and the Nasdaq Index hit record highs due to employment gains the highest expectations Investing.com

Yassin Ibrahim

Investing.com – The S&P 500 and Nasdaq index rose to record highs on Friday as strong employment reports increased optimism about the recovery and led to lower US bond yields, paving the way for technology stocks to rise.

It rose 0.7% to an intraday high of 4,352.20. The Nasdaq rose 0.45%, or 154 points, and the Nasdaq rose 0.78%, setting an intraday record high of 14,640.6 points.

The economy created in June increased significantly from the 583,000 people in April, far higher than the 720,000 people predicted by economists. This is the biggest increase in 10 months.

“Labor shortage is still a problem, but employers seem to be adjusting to the new reality and looking for ways to attract workers with higher wages and/or signing bonuses,” Jefferies (NYSE:) said in a report.

Jefferies added that the average hourly wage rose 0.3% in June, but this was “distorted by disproportionate employment growth in the leisure, hospitality, and retail industries”. “After adjusting the industrial structure, wages in June rose by 0.5% month-on-month and 4.5% year-on-year.”

The expected wage growth may push up inflation and may cause its monetary policy to tighten earlier than expected.

“If this trend does become a reality, it will be a key factor, which will mean that inflation will remain high for a longer period of time. We believe that overall inflation will remain above 4% by 2022, and that the Fed will eventually The possibility of raising interest rates in 2022 is increasing,” ING said.

U.S. bond prices are inversely proportional to yields, shed the prospect that monetary policy is appropriate sooner rather than later, and fell. As an ally of higher-valued stocks, falling bond yields have helped boost technology stocks.

Apple (NASDAQ:) and Microsoft (NASDAQ:) Alphabet (NASDAQ:) Amazon (NASDAQ:) and Facebook (NASDAQ:) :), they together accounted for about a quarter of the weight of the S&P 500 index, an increase of more than 1%.

At the same time, as investors looked forward to OPEC+’s delayed production decision, energy prices gave up some of the previous day’s gains.

According to reports, after the United Arab Emirates opposed the preliminary agreement between Saudi Arabia and Russia on Thursday at the last minute, OPEC and non-OPEC ministers started a meeting on Friday, which was postponed by one day.

In other news, Lordstown Motors (NASDAQ:) fell 11% due to reports that the Department of Justice is investigating the company. The investigation was conducted after the Securities and Exchange Commission investigated the company, which involved short sellers claiming that the company misled investors.