FX.co ★ NonFarm Payrolls stopped S&P 500 rally

Stock rally halted on Friday amid the US Nonfarm employment report. 10-year Treasury bonds also declined by 1.5% for the first time.

But looking at the charts, everything is in an uptrend because all major indices were trading at record highs. The S&P 500 even posted its fifth straight weekly rally, the longest winning streak since August 2020. It closed with a 0.50% gain last week.

And although industrial and commodities stocks outperformed tech companies, the Nasdaq 100 continued to rally. Stocks rose as Pfizer said its Covid pill has reduced hospitalizations and deaths among high-risk patients by 89%, which could change the course of the pandemic. Airlines, cruise operators, hotels and small companies also jumped.

With regards to economic statistics, the US labor market showed impressive improvement in October. It reported better-than-anticipated job gains, indicating roughly 531,000 increase in non-farm employment. The unemployment rate also fell to 4.6%, while the level of economic activity remained unchanged. Average hourly wages, on the other hand, were in line with forecasts, but have increased compared to February.

US President Joe Biden said the economy is recovering from the pandemic faster and stronger than expected, thanks to the programs implemented to stimulate growth. Now, the Congress is discussing a new bill and a broader package of social programs and tax measures.

As for inflation, Kansas City Fed President Esther George said high inflation will persist until 2022 amid rising price pressures.