Market Recap 5 July
| Index / Asset | Level | Weekly Change |
|---|---|---|
| Dow Jones | 52,900 | +1,024 (+1.97%) |
| Nasdaq | 25,832 | +535 (+2.12%) |
| S&P 500 | 7,483 | +129 (+1.75%) |
| MSCI EAFE | 3,085.46 | -39.07 (-3.75%) |
| U.S. 10-Year Treasury | 4.485% | +11.3 bp (+2.56%) |
| WTI Crude | $68.69/bbl | -$0.54 (-0.78%) |
ADP came in soft Wednesday morning, giving the Street hope the Fed might hold off on rate hikes. New Fed Chair Warsh dashed the sentiment hours later. Thursday's soft Non-Farm Payrolls report couldn't reverse it.
The Labor Data
ADP private payrolls grew by just 98,000 in June, below the roughly 110,000 estimate and down from May's 122,000. Education and health services carried nearly half the gains.
Non-Farm Payrolls confirmed the slowdown. June added just 57,000 jobs, well short of the 115,000 estimate, and April and May were revised down a combined 74,000. The unemployment rate ticked down to 4.2%, but only because fewer people were looking for work.
Warsh Speaks
At the ECB Forum on Central Banking, new Fed Chair Kevin Warsh said "prices are too high" and warned that anyone expecting the Fed to tolerate inflation above 2% "would be disappointed."¹ Yields on the 10-year Treasury spiked 2.56% on the week in response.
The Week Ahead
- Monday – ISM and S&P June U.S. Services. Earnings: None.
- Tuesday – None. Earnings: None.
- Wednesday – June FOMC meeting minutes. Earnings: None.
- Thursday – Initial Jobless Claims. Earnings: PepsiCo (PEP).
- Friday – None. Earnings: Delta Airlines (DAL).
Closing Perspective
The labor market is cooling. The new Fed Chair just made clear that doesn't mean rate relief is coming. Markets will spend the next few weeks trying to reconcile those two facts.
We continue to position portfolios for that reality rather than react to any single week of data.
Disclaimer: this is neither a recommendation to buy or sell any securities mentioned above. Investing involves risk and the potential loss of principal.
Footnotes
¹ https://www.cnbc.com/2026/07/01/kevin-warsh-ecb-forum-live-updates.html