S&P 500 and Nasdaq close at record highs after strong jobs market report

Wall Street surged on July 3, closing out the shortened trading session with record highs for the S&P 500 and Nasdaq, as a stronger-than-expected June jobs report lifted investor sentiment, even as it reduced the likelihood of a Federal Reserve interest rate cut this month. The S&P 500 rose 0.83 per cent to close at 6,279.36, while the Nasdaq Composite jumped 1.02 per cent to 20,601.10, both marking all-time highs. The Dow Jones Industrial Average gained 0.77 per cent, ending just shy of its own record at 44,828.53. The rally has been fuelled by retail investors, who are largely ignoring the inflationary pressure on the horizon and uncertainty around tariffs.

The rally came as the US Labor Department reported a gain of 147,000 jobs in June, surpassing economists’ expectations of 110,000. The unemployment rate ticked down to 4.1 per cent from 4.2 per cent, further signalling labour market resilience despite ongoing economic headwinds, including President Donald Trump’s tariff policies and political uncertainty over federal spending.

Nvidia surges, Fed rate cut bets fall

Among standout performers was Nvidia, which climbed 1.3 per cent to push its market capitalisation to $3.89 trillion, just a tad below Apple’s record valuation. The AI chipmaker is now within striking distance of becoming the most valuable publicly traded company in history.

Investors appeared to brush off shifting expectations around monetary policy. Traders have now nearly priced out the possibility of a July rate cut, with CME Group data showing just a 4.7 per cent chance of a reduction this month, down sharply from 23.8 per cent a day earlier. Odds for a September rate cut also fell.

Following the market close, Republicans in the House approved President Trump’s sweeping tax and spending bill, which is expected to add $3.4 trillion to the national debt and impact millions of Americans’ access to health insurance.

Despite potential long-term risks, markets remained buoyed. For the week, the S&P 500 rose 1.72 per cent, the Nasdaq gained 1.62 per cent, and the Dow climbed 2.3 per cent. Trading volume was light ahead of the Independence Day holiday, with just 10.85 billion shares traded versus the 20-day average of 17.82 billion.