Forex Today: Stocks Higher on Strong US Jobs Data

June 4, 2025

Jobless Claims Put a Spring in the Step of Investors

The US Jobs report has given investors a welcome boost, as the labour market continues to defy expectations. The number of job openings, as reported by the Job Openings and Labor Turnover Survey (JOLTS), reached a record high of 11.5 million in April. This surge in job postings has led to speculation that the Federal Reserve may reassess its inflation-fighting stance, potentially leading to a pause in rate hikes.

The news has been widely hailed as a positive for the US economy, which has been under pressure due to global supply chain issues and COVID-19 related disruptions. As a result, stocks have rallied, with the S&P 500 Index jumping 0.8% to face a crucial resistance level at 6,000. The tech-heavy Nasdaq Composite also climbed 1.1%, led by gains in megacap names such as Microsoft and Alphabet.

Resistance at 6,000: Can the S&P 500 Break Free?

The S&P 500 has been making a concerted effort to breach the 6,000 mark, but so far, it has failed to do so. This level has been a major talking point among market analysts, with some predicting that a break above 6,000 could pave the way for a fresh wave of growth shares.

However, the S&P 500 is not the only index facing technical challenges. The tech-heavy Nasdaq Composite has been trading within a tight range for several weeks, with the 100-day moving average acting as a key support level. Any sustained weakness in the Nasdaq could have far-reaching implications for the broader market.

Bank of Canada on Hold – For Now

Meanwhile, the Bank of Canada is set to hold interest rates steady at its upcoming policy meeting, despite growing concerns over the strength of the economy. The Canadian economy has been struggling to recover from the COVID-19 pandemic, and many economists believe that the central bank will need to take decisive action to stimulate growth.

However, the Bank of Canada may choose to hold off on interest rate hikes for the time being, citing concerns over the global economic outlook and the potential for inflation to remain subdued. This could have implications for the Canadian dollar, which has been under pressure in recent weeks due to concerns over the economy.

FX Implications

The strong US Jobs report has sent the US dollar soaring, with the EUR/USD pair dropping to a one-month low. The move higher in the dollar has also led to a decline in the gold price, as investors opted for safe-haven assets such as the US dollar.

In the currency markets, the US dollar’s gains have been particularly pronounced against the Canadian dollar, which has fallen to a multi-month low. This could pose challenges for Canadian exporters, who are already reeling from the impact of the COVID-19 pandemic.

Disclosure: This article is for informational purposes only and does not constitute investment advice. The author and/or their affiliates may hold positions in the assets mentioned in this article.