US stocks surge as jobs data eases recession fears, S&P 500 eyes 20-year win streak

Stocks surged on Friday after the April nonfarm payrolls report beat Wall Street’s expectations, pushing the S&P 500 toward its longest run of gains in over two decades. The index rose 1.5%, putting it on track for its ninth straight win, a streak not seen since November 2004.

The Dow Jones jumped 552 points (a 1.3% gain) and the Nasdaq added 1.7%. That rally erased losses the S&P had carried since April 2, the day President Donald Trump reintroduced tariffs he labeled “reciprocal.” The Nasdaq had already bounced back the day before.

The hiring numbers for April came in hot. The US economy added 177,000 jobs, topping the 133,000 estimate from Dow Jones. It was still a drop from the 228,000 added in March, but nobody expected that kind of strength after weeks of recession panic. The unemployment rate stayed flat at 4.2%.

Wall Street’s recession fears are easing up

Chris Zaccarelli, Chief Investment Officer at Northlight Asset Management, said, “Markets breathed a sigh of relief this morning as the jobs data came in better than expected.” Chris warned that recession fears aren’t gone, but “the buy-the-dip dynamic can continue—at least until the tariff pause runs out.”

Investors were already optimistic before the data hit. China hinted it might start trade negotiations with the US, but made it clear talks won’t happen unless Trump cancels all unilateral tariffs. Chinese officials said:

“If the US wants to talk, it should show its sincerity and be prepared to correct its wrong practices and cancel the unilateral tariffs.”

Later, the Wall Street Journal reported that Beijing is open to discussions.

Apple stock dropped 3% after the company reported a miss in its services division for Q2. Apple also said it expects $900 million in new costs this quarter because of tariffs. Amazon did better. Its first-quarter earnings beat projections, but the company issued a soft forecast, citing “tariffs and trade policies” as a threat to growth.

Zaccarelli added, “We’ve already seen how financial markets will react if the administration moves forward with their initial tariff plan.” He said if Trump doesn’t change course before the 90-day pause expires in July, markets will probably drop again like they did in early April.

Stocks have been climbing ever since Trump announced last month that his new tariffs would be cut to 10% for most countries for 90 days. That pause gave investors some breathing room. Strong earnings reports have helped too. The S&P 500 is now on pace for a 2.3% gain this week. The Dow is set to rise 2.5%, and the Nasdaq is up 2.7% week-to-date.

Markets are still not all that stable

Barclays analysts aren’t convinced the market can keep moving like this. The bank said the market is now back to where it was before Trump’s “Liberation Day” tariffs, but rising recession talk makes that bounce feel unstable. Emmanuel Cau wrote Friday:

“Earnings are holding up for now, but more companies are sounding cautious on the economic outlook, with guidance and capex intentions revised lower. So something has to give, as the many bears may prove too hopeful if a recession becomes unavoidable.”

Lindsay Rosner, Head of Multi-Sector Fixed Income at Goldman Sachs, said the labor data gives the Federal Reserve “scope for patience.” But she also said the outlook is fading and the Fed might return to rate cuts later in the year.

Seema Shah, Chief Global Strategist at Principal Asset Management, said:

“We can push recession concerns to another month. Job numbers remain very strong, suggesting there was an impressive degree of resilience in the economy in play before the tariff shock.”

Seema said weakness might not show up in the numbers for a while, and the next Fed cut could be pushed to Q3. She said there’s no reason to cut rates now while inflation is above target and consumer strength is still solid.

Cryptopolitan Academy: Tired of market swings? Learn how DeFi can help you build steady passive income. Register Now