Stocks Closed At A Record, Ignoring A Bad Jobs Report

Published Friday, May 7, 2021 at: 6:31 PM EDT

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With every other key economic fundamental indicator going strong, the stock market discounted the importance of this morning’s sorely disappointing jobs report, figuring it must be a statistical anomaly. 

Like a driver ignoring the “check engine” light because they know it is caused by an electrical problem in the dashboard, stock market investors ignored the bad jobs report. The stock market surged seven-tenths of 1% on Friday and closed at a new record high, despite a much weaker than expected jobs report.

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Stock market investors brushed aside fears that the sorely disappointing jobs report was a sign that the economy is not as strong as generally expected and the first hint of trouble ahead.

The economy was expected to net 1 million new jobs in April, but the number came in at 266,000. 

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The unemployment rate of 6.1% in April, was up from 6% in March, 6.2% in February, and 6.3% in January. 

A seasonal ad adjustment that the government routinely makes to the jobs figures, combined with distortions due to the pandemic, indeed could have made the jobs numbers appear much weaker than they are. 

“There is often month-to-month volatility in the jobs numbers,”  said Cecilia Rouse, Chair of The Council of Economic Advisers, in a press release by the White House. “However, the same ‘amount’ of volatility is more striking when the volume of changes is larger, as it has been during the pandemic.” 

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The Standard & Poor’s 500 stock index closed this Friday at an all time high of 4,232.60. The index gained +0.74% from Thursday and is up +1.22% from last week. The index is up +61.67% from the March 23rd bear market low. 


Nothing contained herein is to be considered a solicitation, research material, an investment recommendation, or advice of any kind, and it is subject to change without notice. Any investments or strategies referenced herein do not take into account the investment objectives, financial situation or particular needs of any specific person. Product suitability must be independently determined for each individual investor. Tax advice always depends on your particular personal situation and preferences. You should consult the appropriate financial professional regarding your specific circumstances. The material represents an assessment of financial, economic and tax law at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. Forward-looking statements are subject to certain risks and uncertainties. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete, and is not intended to be used as a primary basis for investment decisions. This article was written by a professional financial journalist for Advisor Products and is not intended as legal or investment advice.

This article was written by a professional financial journalist for Advisor Products and is not intended as legal or investment advice.

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