Market developments
Equities: U.S. equity markets finished the holiday-shortened week at record levels, with the S&P 500 gaining 1.7% and the S&P/TSX advancing 1.3%. The rally was driven by a stronger-than-expected June jobs report that showed continued economic momentum. Non-farm payrolls rose 147,000 versus the Bloomberg consensus estimate of 106,000, while unemployment dropped to 4.1% from the expected 4.3%.
Fixed Income: Strong U.S. jobs data surprised markets this week, causing bond prices to fall and yields to rise. The 10-year Treasury yield jumped from 4.27% to 4.34%, while Canada’s rose from 3.30% to 3.35%. Investors now expect the Federal Reserve to skip rate cuts in July, pushing back easing expectations to September.
Commodities: Commodity markets faced significant volatility this week, particularly gold that gained 1.9% during the week.