Employment explosion triggers rate cut expectations! US bonds surge, US stocks rebound throughout the week, S&P posts strongest daily gain in two months, top performer Apple surges 6%, and Amgen rises nearly 12%

The heavy non-farm payroll report released on Friday was even worse than Wall Street's expectations: in April, only 175,000 non-farm jobs were added, hitting a new six-month low, with 65,000 fewer jobs added than expected. The unemployment rate in April did not stabilize from March, instead slightly rising to 3.9%. In addition to reflecting a cooling labor market, the report also showed signs of cooling inflation: the average hourly wage in April grew slower than expected, with year-on-year growth slowing from 4.1% in March to 3.9%, the lowest growth rate in nearly three years, and month-on-month growth slowing from 0.3% to 0.2%.

The non-farm payroll report reignited expectations of a rate cut by the Federal Reserve and hopes for a rate cut in the third quarter. After the report was released, traders increased their bets on a rate cut in September, with the earliest expected rate cut moving up from November before the report to September. The pricing of interest rate swaps reflected traders' expectations of a rate cut this year increasing from around 41 basis points before the report to around 50 basis points. Following Powell's denial of a possible rate hike next, the employment data further pushed up expectations of a rate cut. By Friday, the market expected the Fed to cut rates twice this year.

After the release of the employment data on Friday, the market expected the Fed to cut rates twice this year, with expectations of three more rate cuts next year.

Following the release of the employment report, U.S. Treasury prices surged, with yields plunging more than 10 basis points intraday, erasing all gains since the release of the U.S. CPI in March, falling for three consecutive days. The yield on the two-year U.S. Treasury, sensitive to interest rates, fell more than 20 basis points in three days, the largest three-day decline since January; major U.S. stock indices opened higher across the board. However, after the U.S. stock market opened, bond yields did not fall further, and the decline narrowed. Commentators noted that traders were digesting the report data, and there were signs that some were betting against U.S. bonds and might not be ready to give up.

After the employment report, the April ISM non-manufacturing index released in early trading in the U.S. also fell short of expectations, dropping below the key 50 level into contraction territory, hitting a four-year low. After the data was released, the yield on the two-year U.S. Treasury approached the low set shortly after the employment report. The rising U.S. stock market maintained its upward trend, with major indices rising by at least 1%, the S&P posting its largest daily gain since Nvidia's stunning quarterly report more than two months ago, and ending the week in positive territory.

Leading stocks with positive earnings reports on Friday supported the market's rise: Apple announced that revenue in the Greater China region declined less than expected last quarter, is expected to return to growth this quarter, and will initiate the largest ever $110 billion share buyback program Dividend increased by 4%, stock price once rose by over 8%, ultimately achieving the largest daily increase in nearly a year and a half; Biopharmaceutical company Anjin, with first-quarter earnings and revenue higher than expected, rose by over 1%. Anjin's injectable weight loss drug AMG 133 entered phase III trials, while the small molecule weight loss drug AMG 786 completed phase I clinical trials. "Weight loss drug duo" Eli Lilly and Danish-listed Novo Nordisk were affected, with their stock prices falling by over 3% and 5% respectively during trading.

In the foreign exchange market, after the employment report, the US dollar index saw a rapid decline, erasing all gains since the announcement of faster-than-expected growth in US CPI in March, falling to a low point in over three weeks. Non-US currencies rose during trading, with the Japanese yen against the US dollar reclaiming 152 for the first time in over three weeks during trading, rebounding by over 1% from the daily low. Breaking through 160 may trigger the risk of intervention by the Japanese government again this week. The offshore renminbi surged by over 400 points at one point on Thursday, breaking through 7.17 for the first time since the end of January. Bitcoin also surged during trading, briefly surpassing $62,000, rising by over $3,000 from the daily low, far from the two-month low set after falling below $57,000 on Wednesday.

In the commodity market, with the weakening of the US dollar, London industrial metals generally rose, but some metals failed to maintain their upward momentum this week. On Friday, London copper reversed its three-day decline, still marking the first weekly decline in over a month. After the US employment report, gold surged momentarily, then quickly turned lower, falling by nearly 2% from the daily high to a intra-month low. Some analysts believe that the recent upside potential for gold prices is limited. Despite disappointing employment data, the Federal Reserve is not in a hurry to cut interest rates. Currently, inflation is still too high for the Fed to feel comfortable cutting rates at the next meeting.

After the US employment report, international crude oil briefly rose, hitting a daily high, but quickly continued to fall and dropped to the lowest level since early March. Both US oil and Brent oil continued to decline this week, marking their worst weekly performance since early February. This reflects the easing of Middle East conflict risks during negotiations for a ceasefire agreement between Israel and Hamas, reduced supply disruption risks, and increased concerns about demand due to US crude oil inventories far exceeding expectations and poor economic data.

The three major US stock indices rose by at least 1%, with Apple achieving its largest increase in 17 months. Chip stocks rebounded for two days but still ended the week lower. The energy sector fell by over 3% for the week, while Chinese concept stocks rose for three consecutive days.

The three major US stock indices opened higher for two consecutive days, maintaining overall gains of at least 1%. During the morning session when hitting a daily high, the Nasdaq Composite Index rose by about 2.3%, the Dow Jones Industrial Average rose by over 580 points, up by more than 1.5%, and the S&P 500 Index rose by nearly 1.5%. By midday, the Dow and S&P were up by over 1%, while the Nasdaq's increase briefly exceeded 2%. Ultimately, all three indices closed higher for two consecutive days, with the Dow rising for three consecutive days.

The S&P rose by 1.26%, marking its largest daily increase since Nvidia's earnings report on February 22, reaching 5127.79 points, hitting a high since April 11. The Nasdaq rose by 1.99%, approaching the largest increase since February 22, which was achieved with a 2.03% increase last Friday, closing at 16156.33 points, hitting a high since April 12 The Dow Jones Industrial Average rose by 450.02 points, up 1.18%, marking the largest daily gain since March 27, closing at 38675.68 points, hitting a high not seen since April 9.

The tech-heavy Nasdaq 100 Index rose by 1.99%, with the Nasdaq Technology Market Cap Weighted Index (NDXTMC) measuring the performance of tech stocks in the Nasdaq 100 Index rising by 2.48%, both hitting highs not seen since April 12 for two consecutive days. The small-cap Russell 2000, which is value stock-oriented, rose by 0.97%, marking a three-day consecutive increase and hitting highs not seen since April 11 for two days.

Major U.S. stock indices have seen cumulative gains this week, but the momentum of the S&P and Nasdaq, which saw their largest increases since November last week, has noticeably slowed down. The S&P, which rose by 2.67% last week, increased by 0.55%, while the Nasdaq, which rose by 4.23% last week, increased by 1.43%. The Nasdaq 100, which rose by about 4% last week, increased by 0.97%, and the Russell 2000 increased by 1.68%, both marking two consecutive weeks of gains. The Dow Jones rose by 1.14%, marking three consecutive weeks of gains.

In the Dow Jones component stocks, at the close, Amgen (AMGN) led the gains, rising by over 11.8% on the first trading day after announcing its financial results, also leading the S&P 500 component stocks, with Apple coming in second. McDonald's fell by nearly 1.1%, showing the worst performance, while the only energy stock, Chevron, fell by 0.3%.

Among the major sectors of the S&P 500, only the energy sector fell by less than 0.1% on Friday, with the IT sector where Apple belongs rising by 3%, far ahead of other sectors. Communication services and materials, with the second highest increase, rose by 1%. Only two sectors saw declines this week, with the energy sector falling by nearly 3.4%, the financial sector falling by over 0.6%, utilities leading with a rise of over 3%, non-essential consumer goods rising by 1.6%, real estate and IT rising by about 1.5%, and materials remaining roughly flat compared to a week ago.

Among the S&P 500 sector ETFs, utilities performed the best this week, while energy performed the worst, and the financial sector saw a cumulative decline throughout the week.

Including Microsoft, Apple, Nvidia, Google's parent company Alphabet, Amazon, Meta (Facebook's parent company), and Tesla, the tech giants "Seven Sisters" all saw gains at one point, with Apple performing the best. Alphabet and Tesla saw intraday declines, with relatively weaker momentum.

Tesla rose by 2.6% in early trading, but turned lower in both the morning and afternoon sessions, closing up by nearly 0.7%. It saw a two-day consecutive increase but failed to reach the closing high since March 1 set on Monday, as it surged by 15% on Monday and rose by nearly 7.7% this week, falling short of the over 14% rebound seen last week Among the six FAANMG technology stocks, Apple rose by about 8.1% in early trading after announcing its financial report, closing up by about 6%, marking the largest closing gain since November 30, 2022, rising for two consecutive days to a high closing level since February 22. Microsoft rose by 2.2%, Meta rose by 2.3%, both rising for three consecutive days to a high since April 24. Amazon rose by 0.8%, rising for three days after announcing its financial report, refreshing the closing high since April 11. Alphabet initially fell, dropping nearly 2.1% in early trading, then rose by 0.3% at midday, rising for three days but still unable to approach the closing historical high set last Friday. Netflix rose by 2.5%, rising for three days to a high since April 18.

Overall, chip stocks continued to rise, with the Philadelphia Semiconductor Index and the Semiconductor Industry ETF SOXX rising by 2.4% and nearly 2.3% respectively, rising for two consecutive days but still unable to erase the decline within the week, accumulating declines of 0.4% and 0.3% respectively for the week. Among chip stocks, NVIDIA rose by nearly 3.5%, rising for two days to a high since April 11, with a weekly increase of about 1.2%, far less than the 15% surge of the previous week. AMD rose by 3%, as it fell sharply by 9% on Wednesday after announcing its financial report, accumulating a decline of 4.3% for the week. At the close, TSMC's US stock rose by 3.9%, Arm rose by 3.8%, Broadcom rose by 3.2%, Micron Technology rose by 2.1%, Intel rose by 1.3%, while Qualcomm, which surged nearly 10% on Wednesday after announcing its financial report, fell by nearly 0.3% in early trading.

NVIDIA, Apple, and other seven technology giants overall rose on Friday, pushing towards the historical high set three weeks ago.

Most AI concept stocks continued to rise. At the close, C3.ai (AI) rose by 3.8%, Palantir (PLTR) rose by about 3.5%, Super Micro Computer (SMCI) rose by nearly 2.7%, Adobe (ADBE) rose by 2%, Oracle (ORCL) rose by 0.7%, SoundHound.ai (SOUN) rose by 0.2%, while BigBear.ai (BBAI), which saw a dramatic 21% revenue decline in the first quarter and a loss per share far exceeding expectations, fell by 13.9%, known as "Little NVIDIA", and Astera Labs (ALAB), which sells data center interconnect chips, fell by nearly 2.7%.

Overall, popular Chinese concept stocks continued to rise, but the upward trend was milder than Thursday. The Nasdaq Golden Dragon China Index (HXC), which surged by 6% on Thursday, rose by 1.7%, rising for three consecutive days, refreshing the closing high since October 2023, with a 5.5% increase for the week after a nearly 9% surge last week. The Chinese concept ETFs KWEB and CQQQ rose by nearly 1.7% and 0.4% respectively. The three new energy vehicle startups that surged on Thursday fell back, with XPeng dropping by about 3.6% at the close, Li Auto dropping by about 3.4%, Nio dropping by nearly 0.5%, while Xiaomi's fan base rose by nearly 0.9% Among other individual stocks, by the close, NetEase rose more than 4%, Yum China rose 2.8%, Pinduoduo rose nearly 2%, Alibaba and Baidu rose more than 1%, Bilibili rose nearly 0.8%, JD.com rose 0.7%, while GDS Holdings fell more than 4%, and Tencent Music Entertainment Group slightly declined.

Among the stocks that announced their financial reports, cloud services provider Cloudflare (NET) fell by 16.4% despite first-quarter revenue exceeding expectations but full-year guidance disappointing; after lowering its full-year growth guidance to mid to high single-digit growth, online travel giant Expedia (EXPE) fell by nearly 15.3%; despite first-quarter performance exceeding expectations and a slight upward revision of profit guidance, healthcare services provider DaVita (DVA) fell by 5.5%; despite announcing first-quarter revenue doubling growth exceeding expectations and the Bitcoin ETF driving its institutional trading volume to a historical high, cryptocurrency exchange leader Coinbase (COIN) still fell by nearly 2.5%; payment services provider Block (SQ), with first-quarter revenue and profit exceeding expectations, opened high but closed down by nearly 1.2%.

Meanwhile, entertainment company Live Nation Entertainment (LYV) rose by 7.2% after announcing first-quarter revenue exceeding expectations, management expecting strong demand for sports venues next year, and continued growth in concert attendance; online travel service giant Booking Holdings (BKNG) rose by 3% as the Easter holiday period drove better-than-expected performance for the next quarter.

Among the stocks with significant fluctuations, cloud networking company Arista Networks (ANET) rose by over 5% during trading after being upgraded to a buy rating by Jefferies and expected to be a major beneficiary of AI, closing up by 4.8%; due to the impact of progress in the development of its weight-loss drug, Eli Lilly (LLY) fell by around 2.8% after briefly dropping by about 3.4% during trading; Paramount Global (PARA), which surged on Thursday, fell by 7% after media reports on Thursday that private equity firm Apollo and Sony jointly issued a $26 billion acquisition offer, leading to a more than 13% increase in Thursday's closing.

European tech stocks followed the rebound of US stocks, driving the pan-European index higher. The STOXX 600 index in Europe rose by nearly 0.5%, not extending further from the high close since April 8 set on Tuesday. Most major European country indices closed higher. The UK stock market rose for two consecutive days, setting a new closing high for the third day this week, while German and French stocks rebounded after three days of decline, and Italian stocks, which fell for three consecutive days, stopped their decline on Thursday, and Spanish stocks fell back after two consecutive days of decline.

In various sectors, the technology sector led the gains with an increase of over 1.7%; real estate sensitive to interest rates rose by nearly 1.2%; while the banking sector fell by nearly 0.5%, with France's largest bank, BNP Paribas, plummeting by about 5.2% after predicting that annual net interest income from retail business will be at the lower end of guidance, while the second-largest bank in France, Credit Agricole, which saw a 55% increase in first-quarter net profit exceeding expectations, rose by 1.1%; the healthcare sector fell by 0.45%, driven by the announcement of progress in the development of a weight-loss drug by Eli Lilly, with Danish-listed Novo Nordisk, the highest market value pharmaceutical company in Europe, briefly falling by 5.3% during trading and closing down by about 2.6% This week, the Stoxx 600 index fell by less than 0.5%, falling after ending a four-week decline last week. Most stock indexes in various countries fell, with the DAX index falling after rebounding last week, marking the fourth consecutive weekly decline in the past five weeks. The French, Italian, and Spanish stock indexes fell after two weeks of gains, while the UK stock index stood out, rising for two consecutive weeks after three weeks of decline.

Among various sectors, the real estate sector performed the best this week with a cumulative increase of about 4%, reflecting the impact of European bond yields following the decline in U.S. bond yields. Retail sector fell by nearly 3%, oil and gas sector fell by over 2% due to the decline in crude oil prices, and despite a Friday rally, the technology sector fell by nearly 1.6%. The healthcare sector fell by nearly 0.7%, affected by Novo Nordisk's cumulative decline of nearly 4.1% this week.

Following the employment report, U.S. bond yields plunged by over 10 basis points, with the 2-year yield experiencing the largest three-day decline since January.

The yield on the 10-year U.S. Treasury benchmark bond quickly dropped below 4.50% after the U.S. employment report, falling by over 13 basis points intraday, hitting a low not seen since April 10th, and closing around 4.51% at the end of the bond market session, down by about 7 basis points intraday. Yields on various maturities of U.S. bonds have declined for three consecutive days. The 10-year yield fell by approximately 15 basis points this week, reversing after four consecutive weeks of increase, marking the first weekly decline since the end of March.

Yields on various maturities of U.S. bonds have cumulatively declined by at least 10 basis points this week, with the yield on short-term bonds leading the decline.

The 2-year U.S. Treasury yield, which is more sensitive to interest rate prospects, quickly fell below 4.80% after the employment report, dropping to below 4.71% at one point, hitting a low not seen since April 10th, and closing around 4.82% at the end of the bond market session, down by about 5 basis points intraday. After roughly no change in the previous week, the 2-year yield fell by approximately 17 basis points this week, marking the first weekly decline in the past six weeks. The yield fell by over 20 basis points in the three days from Wednesday to Friday, marking the largest three-day decline since January this year.

Following the non-farm employment report, the U.S. dollar index hit a new low of over three weeks, the Japanese yen rebounded by over 1%, and the offshore Chinese yuan rose above 7.17, reaching a new high of over two months Tracking the ICE US Dollar Index (DXY), which tracks the exchange rate of the US dollar against a basket of six major currencies, approached 105.40 in the early Asian session to refresh the daily high. It rose less than 0.1% intraday, quickly turned lower and maintained a downward trend. European stocks turned higher in pre-market trading, and after the release of the US non-farm payrolls report, it quickly fell below 105.00, with the intraday decline rapidly expanding. US stocks approached 104.50 in pre-market trading, refreshing the low since the US CPI for March was announced on April 10, falling more than 0.7% intraday (closing at 105.299 on Thursday), before narrowing some of the losses.

By the time the US stock market closed on Friday, the US Dollar Index hovered around 105.00, falling nearly 0.3% intraday and accumulating a decline of nearly 0.9% for the week. The Bloomberg Dollar Spot Index, which tracks the US dollar against ten other currencies, fell nearly 0.3% intraday, hitting a low since April 11 for the second consecutive day, with a weekly decline of nearly 1%. After the US employment report, it fell nearly 0.8% intraday, marking the third consecutive day of decline for both the US Dollar Index and the Bloomberg Dollar Spot Index, as well as the second consecutive week of decline.

Among non-US currencies, the Japanese yen surged intraday, with the US dollar falling below 151.90 after the US employment report was released, breaking below 152.00 for the first time since April 10, dropping nearly 1.3% from the intraday high near 153.80 in the Asian session, and falling nearly 1.2% intraday. By the end of the bond market session, it was slightly above 153.00, down nearly 0.4% intraday. After the US employment report, the euro quickly rose above 1.0810 against the US dollar, and the British pound rose above 1.2630, both hitting highs since April 10, with an intraday increase of about 0.8%, before giving back more than half of the gains. At the close of the US stock market, the euro was above 1.0760, up nearly 0.4% intraday, while the pound hovered around 1.2550, up less than 0.2% intraday.

In the early Asian session, the offshore Chinese yuan (CNH) hit a daily low of 7.2058 against the US dollar, then quickly rose. After the US employment report, it rose to 7.1653, hitting a high since January 25, with an intraday increase of 410 points. At 4:59 am Beijing time on May 4, the offshore Chinese yuan against the US dollar was reported at 7.1928 yuan, up 135 points from the New York closing on Thursday, rising for the third consecutive day and the fourth day of the week. After falling last week, it rose 759 points for the week, marking the fourth consecutive week of gains in the past six weeks.

Bitcoin (BTC) quickly rose above $60,000 after the US employment report was released. In early US stock trading, it rose above $62,100, with some platforms testing $62,300, hitting a high since April 30. It rebounded over $3,000 from the intraday low below $58,800 in the Asian session, up about 6%, far from the low since the end of February after falling below $56,800 on Wednesday. At the close of the US stock market, it hovered around $62,000, rising more than 4% in the past 24 hours and falling more than 3% in the past seven days After rebounding on Friday, Bitcoin tested $62,000, but still fell for the whole week.

Crude oil hit a seven-week low and the biggest weekly drop in three months. U.S. oil fell for the fifth consecutive week, dropping nearly 7% in a week.

After the U.S. employment report was released, international crude oil futures rose in the short term to refresh daily highs. U.S. WTI crude oil rose above $79.60, up nearly 0.9% intraday, while Brent crude approached $84.40, up nearly 0.9%. Before the U.S. stock market opened, it turned down, and continued to decline. At midday, when the U.S. stock market hit a daily low, U.S. oil fell to $78, down 1.2% intraday, while Brent oil approached $82.80, down about 1% intraday.

In the end, crude oil fell across the board, hitting seven-week lows. WTI June crude oil futures closed down $0.84, or 1.06%, at $78.11 per barrel, falling for five consecutive days and hitting lows not seen since March 12 for three consecutive days. Brent July crude oil futures, which stopped a three-day decline on Thursday, closed down $0.71, or about 0.85%, at $82.96 per barrel, refreshing lows not seen since March 12 set on Wednesday.

U.S. oil fell nearly 6.9% this week, while Brent oil fell about 6%, marking the largest weekly decline since February 2. After two consecutive weeks of decline at the end of last week, it fell back. Since the outbreak of the Israel-Palestine conflict, it has fallen for the 17th week in the past 30 weeks, the third week of decline in the five weeks since the first quarter surged by over 10%.

U.S. WTI crude oil hit lows not seen since early March again on Wednesday, marking the largest weekly decline in three months.

U.S. gasoline and natural gas futures showed mixed movements. NYMEX June gasoline futures, which rebounded on Thursday, closed down about 1.6% at $2.5551 per gallon, refreshing lows not seen since March 8 set on Wednesday, falling about 6.9% this week after rebounding last week. NYMEX June natural gas futures rose nearly 5.26%, closing at $2.142 per million British thermal units, up for two consecutive days, hitting highs not seen since January 26, with a weekly increase of about 11.4% after three weeks of decline.

London tin rose more than 3% but still fell for two consecutive weeks. London copper rebounded but ended a four-week winning streak. Gold rose after the employment report, but then fell nearly 2%.

London base metal futures rose across the board on Friday. London tin and nickel both rose more than 3%, with tin continuing to move away from the lows set on Tuesday and Wednesday, while nickel bid farewell to the lows set in the past two weeks. Copper, which fell for three consecutive days, rose nearly 1.5%, climbing back above $9,900 after closing below $9,800 for the first time in a week on Thursday, but failed to approach the closing high of $10,000 set on Monday, the highest in two years. Zinc, which fell for two consecutive weeks, rebounded slightly, while lead, which closed flat on Thursday, rose more than 1%, approaching the high set in November last year on Monday London zinc continued to rise for two consecutive days, approaching the high point set in March last year on Monday.

Basic metals experienced mixed movements this week. After a strong performance last week, London copper fell by nearly 0.6% following four weeks of gains, London tin dropped by over 1%, and London aluminum fell by 0.7%, all declining for two consecutive weeks. On the other hand, London zinc, which had risen for three consecutive weeks by the end of last week, saw an accumulated increase of over 2%, London nickel rose by about 0.7%, and London lead rose by about 0.3%, all rebounding after last week's decline.

After the US employment report, gold prices surged momentarily during the trading session, with New York gold futures rising to $2330.7, up by approximately 0.9% intraday. Spot gold broke through $2320.50, rising by over 0.7% intraday, but quickly turned downward. As US stocks hit a low not seen since April 5th at the beginning of the trading session, futures gold fell to $2285.2, down by nearly 1.1% intraday, retracting by almost 2% from the daily high. Spot gold dropped to $2277.6, down by over 1.1% intraday and over 1.8% from the daily high, gradually erasing most of the losses.

COMEX June gold futures closed down by 0.04% at $2308.6 per ounce, only about $6 away from the closing low seen on April 2nd, with a cumulative decline of 1.64% for the week.

At the close of the US stock market, spot gold was slightly above $2300, down by approximately 0.1% intraday. With a drop of nearly 2% on Tuesday, spot gold has accumulated a decline of over 1.6% for the week, along with futures gold, both declining for two consecutive weeks.

Despite reinforced expectations of interest rate cuts by the Federal Reserve and strong employment data, spot gold has continued to decline for two consecutive weeks this week