Trump on Wednesday said he reached a deal with Vietnam, where US products sold in the country will face zero tariffs and Vietnamese-made goods will face a US tariff of 20 per cent. That helped Nike’s stock rise 3.8 per cent. Factories in Vietnam made half of all Nike brand footwear in its fiscal year of 2024.
Other factors could also be dragging on the job market, such as the US government’s termination of protected status for 350,000 Venezuelans, potentially exposing them to deportation. That alone could create a drag on payrolls of 25,000 jobs, according to Goldman Sachs economist David Mericle, whose forecast for Thursday’s report is weaker than many of his peers.
In the bond market, the yield on the 10-year Treasury rose to 4.30 per cent from 4.26 per cent.
But the two-year Treasury yield, which more closely tracks expectations for what the Federal Reserve will do with its overnight interest rate, held at 3.78 per cent.
An unexpected weakening of the job market could push the Fed to cut interest rates in order to give the economy a boost. So far this year, the Fed has said it would rather wait to see how Trump’s tariffs affect the economy and inflation before cutting rates any further.
Trump, meanwhile, has been angrily calling for cuts to rates to happen sooner.
On Wall Street, Tesla rose 4.6 per cent after the electric-vehicle company said it delivered nearly 374,000 of its Model 3 and Model Y automobiles last quarter. That was better than analysts expected, according to FactSet, though its overall sales fell 13 per cent from a year earlier. Worries have been high that potential Tesla buyers are getting turned off by CEO Elon Musk’s involvement in politics.
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Microsoft began job cuts that will impact about 9000 workers, its second major wave of layoffs this year as it seeks to control costs while ramping up on artificial intelligence spending. Less than 4 per cent of the company’s total workforce will be impacted, a spokesperson said. The cuts will have an impact across teams, geographies and tenure and are made in an effort to streamline processes and reduce layers of management, the spokesperson added. Microsoft shares are 0.4 per cent lower in late trade.
Constellation Brands climbed 4.3 per cent despite reporting a weaker profit for the latest quarter than analysts expected. The seller of Modelo beer and Robert Mondavi wine said that growth in jobs slowed during the quarter for the construction industry and other “4000 calorie+” sectors, which tends to hurt demand for its beer. But it nevertheless stuck with its financial forecasts for the full upcoming year.
Centene tumbled 39.7 per cent after the health care company withdrew its forecasts for profit this year. That followed an initial look at some data suggesting sickness trends in many of the states where Centene does business are worse than expected.
In stock markets abroad, indexes were mixed as the July 9 deadline approaches for Trump and other countries to make trade deals before Trump’s tariffs come off their pause.
France’s CAC 40 rose 1 per cent, and Hong Kong’s Hang Seng gained 0.6 per cent. But Japan’s Nikkei 225 fell 0.6 per cent, and South Korea’s Kospi dropped 0.5 per cent.
AP, Bloomberg
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