Jobs Data Shock Triggers Broad Market Selloff

The US economy added 172,000 jobs in May, more than double the forecast of 80,000. That miss rearranged markets.

Friday's stronger-than-expected employment data triggered a broad selloff across stocks, bonds, and crypto, as traders rapidly repriced the odds of a Federal Reserve rate cut. The Nasdaq Composite plunged 4.2%, its steepest single-day decline since October. The S&P 500 shed 2.6%, and the Dow dropped nearly 700 points.

The unemployment rate held steady at 4.3%. Market strategist Ronald Temple noted the data effectively eliminated near-term hopes for a Fed rate cut. The 10-year yield jumped to about 4.55%, while the 2-year yield rose to 4.16%.

Technology bore the brunt. Growth and AI stocks are vulnerable to rising rates because their valuations depend heavily on future cash flows.

Digital assets also suffered. Bitcoin dipped toward $60,000 as the risk-off trade swept through asset classes. Crypto equities Coinbase, Robinhood, and MicroStrategy all fell more than 6%.