Jobs Report Boosts U.S. Stocks Amid Trade Tensions

US stocks are slightly higher this morning after closing up on Friday after a strong jobs report which eased some worries about the US economy.

The S&P 500 closing above 6000 for the first time since February 21st, driven by tech stock gains.

The uncertainty does remain over how the economy is holding up, especially with ongoing.

While President Trump has backed off, some tariffs investors are watching closely for any ripple effects.

Now 3 cabinet officials from the Trump administration are meeting with Chinese representatives in London today to discuss a trade deal.

Well, joining me to weigh in as we kick off a new trading week is Chris Versace, CIO of Tomaica Research.

Good morning, Chris, and happy Monday to you.

Well, in terms of economic data here in the US, the economy added 139,000 jobs last month in terms of non-farm payrolls, which was better than expected.

But we did see hiring slow compared to the prior months.

So is the fear downturn from Trump's trade wars still looming on the horizon?

I think it does, Remi, and I think that happens for a couple of reasons, you know, yes, the 139,000s was modestly better than expected and certainly well ahead of what people expected after ADP's May employment Change report.

But the reality is when you sift through the data and you realize that we lost 22,000 federal jobs in the month of May alone, but given the Doge-related program, people who are still receiving, you know, payments through September are counted as working, which means that when they roll over in the second half of the year, we're likely to see those federal jobs, those losses accelerate.

But the other thing that stood out to me was the acceleration in wage growth, Remy, which added to a couple of other factors, has me thinking this week's inflation data could come in a little hotter than expected.

Yeah, and speaking of those inflation figures, Chris, we get CPI followed by PPI in midweek trades.

So I do want to get your take on CPI expectations and also the accuracy of CPI, which is under some scrutiny.

So the BLS says it's no longer collecting.

Data in 3 mid-sized cities which include Lincoln, Buffalo, and Provo, and it's relying more on educated guesses for some items and that could mean this crucial economic indicator may be a little less precise than before.

But nonetheless, what are your expectations and what could this mean for the Fed?

So I, I agree with you, Remy, that to the extent that we have these changes, it is going to be a little less reliable information, but nonetheless, it is one of the data points that we get.

And as I always tell folks, you can't rely on any one data point.

You have to triangulate around them, and we do get a number of different inflation metrics, not just hard economic data and soft economic data, but rolling forecasts from various.

That member banks.

So I think there's enough that we can still wrap our heads around what's unfolding.

That said, I do see the CPI ticking higher both on a headline and core basis sequentially, not just on a month over month basis, but also on a year over year basis.

My concern is that the market's expectation is up slightly, and we could see something more than that.

I think when we trace back to what We saw in the ISM services PMI data for pricing, which was a big jump, and on the manufacturing side that was remaining at very, very elevated levels along with that wage data, I think we're going to get a positive pop in the CPI data, even the PPI data, and my concern, Remy, is the market is not ready for that because it still sees 3 Fed rate cuts according to the CME Fedwatch tool.

And Chris, I do want to shift our focus on over to the trade talks that are underway in London.

These talks in the UK are a big deal and a lot is at stake.

And as you mentioned, the US economy, we will have to see what comes out.

Those inflation figures we're watching to see what happens with growth, but no one wants a repeat of April's standoff, which nearly pushed the global economy into a recession.

So what do you expect to see out of those trade talks that are currently underway in London?

Well, first off, Remi, if anybody's expecting an imminent trade deal, I think that's going to be a mistake.

These things do take time.

There are a lot of issues to hammer out.

Could we get some constructive headlines about the tone of the talks?

I think that is certainly possible.

I do expect them to focus in on technology and export controls, rare earth elements, student visas, and a few other items.

But again, I think this is, this is going to be something that's measured in days.

Um, and what we learned could very well set the pace of conversations with the European Union, Japan, and other key conversations on the trade front.

And finally, we have about 60 seconds here, so let's shift our focus over to Northern California.

Apple is kicking off Worldwide Developers Conference, its major software event.

So what do you expect to hear out of this event?

I've got to be honest with you, Remy.

I think this year the keynote address that begins later today could be a little bit of a, you know, letdown for a lot of folks.

Typically this is the event where Apple tries to wow the development crowd, even, even other folks, by showcasing what's next for its upcoming releases for, you know, iPhone. iPad, Mac OS software, and you know everything that we've been hearing leading into this event is it's more of a user interface refresh.

Now, could there be a surprise on the AI front?

Certainly possible, but whether it's Apple Intelligence or what Apple is doing under the hood on AI remains to be seen.

OK, Chris, well, thank you so much for joining us and weighing in on what's moving the markets.

We look forward to speaking with you again next week.

Thanks, Remy.