Stock markets are rebounding despite negative new data

Stock markets rallied on Friday. Investors are optimistic as the governments are lifting lockdowns and plan to reopen some businesses. While it’s hard to tell how long the rally will last, some experts hope that it will be long-term.

U.S. futures continue rising, adding to last week’s gains. The Nasdaq jumped by 1.1% to 9,207.75, moving in the green. The Dow Jones futures climbed up by 1.11% to 24,107.00, and the S&P 500 futures soared by 1.13% to 2,912.5.

Investors weren’t deterred by the negative expectations about the U.S. Labor Department’s April jobs report, which was due on Friday. According to reports, the data would show that U.S. employers slashed 22 million payrolls for the month. Furthermore, experts speculated that the unemployment rate would show a 16.0% growth compared to 4.4% in March.

However, the general mood was upbeat, as the pandemic slowed in several countries. Even though weekly unemployment insurance claims have increased by almost 3.2 million reports since May 2, shareholders think that the worst is in the past. Still, recovery won’t be easy, considering there were 33 million claims since March 20.

The industries that have deeply underperformed during the pandemic are edging up, some airline and cruise line stocks among them. Energy and Financials sectors, which were the worst performers in the S&P 500 in 2020, gained the most on Thursday. Their increase is significant, as it shows that most neglected stocks are rebounding.

What about the U.S.-China tensions?

U.S. President Donald Trump announced that he considers China guilty of coronavirus outbreak, as it originated from Wuhan. Investors feared that Trump’s statements would undermine the one trade deal and escalate tensions between the countries.

However, Treasury Secretary, Steven Mnuchin, and U.S. Trade Representative, Robert Lighthizer, spoke with China’s Vice Premier, Liu He last week. Afterwards, the U.S. Trade Representative stated that both countries fully expect to meet their obligations under the agreement in time.

Furthermore, all parties agreed that the discussions over the implementation of the phase one U.S.-China trade deal are progressing well so far.