Title Image

WeekWatch -‘Better-than-expected employment figures capped a strong week for US markets’ July 2021

WeekWatch -‘Better-than-expected employment figures capped a strong week for US markets’ July 2021

Better-than-expected employment figures capped a strong week for US markets, which had continued to chart into historic high territories in anticipation of the data.

Figures released at the start of Friday were expected to show the US had added 720,000 jobs to its economy – which would represent the sixth consecutive month of growth. The actual growth exceeded this number, at 850,000.

The sector that saw the largest growth in headcount was, perhaps unsurprisingly, leisure and hospitality, which added 343,000 new jobs in the month, suggesting it’s bouncing back after a prolonged, COVID-19-induced period of difficulty.

“Overall, this report signals incremental progress in the pace of job growth, but there’s no sign yet of a shift back into the labour force. The missing millions are still missing, but it’s too soon to see any impact of the early ending to the $300 per week unemployment benefit uplift in a few states,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

He continued: “It’s reasonable to expect a modest shift back into the labour force in July and August as more states cut off the benefit, but when the federal money runs out on September 6, about 70% of unemployed people will still be receiving the uplift.”

US markets, which had been rising all week, generally ended the week on a high as a result of the news. It also encouraged a rise European stocks on the Friday; however this wasn’t enough to fully compensate slight falls seen over the rest of the week, and the FTSE 100 finished the week flat while the STOXX Europe 600 Index finished down slightly.

Part of the worry in Europe has been the spread of the Delta variant of COVID-19. The UK has seen a recent spike in COVID-19 numbers, just as the end of the restrictions (due 19 July) approaches. While these exchanges may have finished the week slightly down, the overall first half of the year has been positive on both sides of the Atlantic. Over the first six months of the year, the FTSE 100 rose 8.57%, while the STOXX Europe 600, S&P 500, Nasdaq and Dow Jones have all experienced double-digit growth since the start of the year.

Speaking about the market improvement in the first half of this year, Darren Johnson, Head of Engagement – Investment Consultancy at St. James’s Place, suggested that markets have responded to the underlying economic improvement that has become more likely since vaccine rollouts began at the end of last year.

“Markets are a leading indicator of where the economy is likely to go. And the economy is likely – we can debate it, but it’s likely – to improve from where it’s been. So, it shouldn’t be a surprise that markets have gone that way,” he said.

He added that many funds which struggled last year have done reasonably well this year. He said: “The funds that struggled last year are the ones that, ultimately, have done the best this year. And that brings us on to the benefits of diversification: it really does show you how quickly things can change without you noticing.”





The information contained is correct as at the date of the article. The information contained does not constitute investment advice and is not intended to state, indicate or imply that current or past results are indicative of future results or expectations. Where the opinions of third parties are offered, these may not necessarily reflect those of St. James’s Place.

FTSE International Limited (“FTSE”) © FTSE 2021. “FTSE®” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under licence. All rights in the FTSE indices and/or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent.

© S&P Dow Jones LLC 2021; all rights reserved

The ‘St. James’s Place Partnership’ and the titles ‘Partner’ and ‘Partner Practice’ are marketing terms used to describe St. James’s Place representatives.

Members of the St. James’s Place Partnership in the UK represent St. James’s Place Wealth Management plc, which is authorised and regulated by the Financial Conduct Authority.

St. James’s Place Wealth Management plc Registered Office: St. James’s Place House, 1 Tetbury Road, Cirencester, Gloucestershire, GL7 1FP, United Kingdom.  Registered in England Number 4113955.

Proud to be supports of...

Links from this website exist for information only and we accept no responsibility or liability for the information contained on any such sites. The existence of a link to another website does not imply or express endorsement of its provider, products or services by St. James's Place. Please note that clicking a link will open the external website in a new window or tab.

88/89 Whiting Street
Bury St Edmunds
Suffolk, IP33 1NX
01284 703422

Registered in England and Wales
Company No.06803554

The Partner Practice is an Appointed Representative of and represents only St. James's Place Wealth Management plc (which is authorised and regulated by the Financial Conduct Authority) for the purpose of advising solely on the Group’s wealth management products and services, more details of which are set out on the Group’s website www.sjp.co.uk/products. The ‘St. James's Place Partnership’ and the titles ‘Partner’ and ‘Partner Practice’ are marketing terms used to describe St. James's Place representatives.