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The U.S. economy added 303,000 jobs last month. That was far more than than the 192,000 expected by economists.The unemployment rate dipped to 3.8%.

For today at least the stock market sees the report as “The glass is half full.”

Yes, a stronger than expected labor market raises the odds that the Federal Reserve won’t begin its interest rate cuts at its June 12 meeting. But the strength in the economy is good for stocks. And if not June, then the Fed will cut in July, the thinking goes today.

Today, April 5, as of 10 a.m. in New York, the Standard & Poor’s 500 index was up 0.51% and the Dow Jones Industrial Average ws ahead 0.21%. The NASDAQ Composite had gained 0.66%. The small-cap Russell 2000, however was off 0.12%.

Over on the one side, the news pushed bond prices down somewhat and raised yields with the yield on the benchmark 10-year Treasury climbed 7 basis points to 4.38%. The yield on the 10-year Treasury is now up 23 basis points in row last month.

The CME FedWatch Tool, which calculates the odds of a Fed move by looking at prices in the Fed Funds Futures market, shows the odds that the Fed would not cut interest rates at the July 31 meeting had climbed to 26.5% today from 19.3% yesterday, April 4. The market is clearly still counting on a July cut. Odds that the Fed won’t cut at the June 12 meting climbed to 45.2% from 34.2% yesterday.

Wall Street has decided to wait for next week’s Consumer Price Index inflation report before rethinking its belief in a cut in rates this summer. Some numbers in today’s report say that makes sense. In March wages rose by 0.3% from the previous month and were up 4.1% over the year. That was raw smallest gain since June 2021. A slowdown in wage gains would suggest that inflation isn’t about of spike because of labor market strength. In addition, the workforce participation rate rose. More workers means more consumer spending.