US stock markets closed higher on Friday, even though the latest American jobs report showed a decline of 23,000 positions in July. Danish economists described the figures as weak across the board.
DR reports that the main American indexes all ended Friday in positive territory. The S&P 500 rose 0.6 percent, the Nasdaq gained 1.3 percent, and the Dow Jones added 0.3 percent.
The rise came a day after the US Bureau of Labor Statistics published the monthly nonfarm payroll figure. According to the report, employment outside agriculture fell by 23,000 in July. Tine Choi Danielsen, chief strategist at the Danish pension company PFA, told DR that markets had expected a gain of 80,000 jobs.
Danielsen linked the market reaction to expectations about the Federal Reserve’s next meeting in September. She said the weak report has eased the pressure on the central bank over the rate increases that have been widely discussed. Share prices rose while yields fell back slightly, she noted.
The report also included downward revisions for the two previous months. Job growth for May and June was cut by a combined 103,000 positions. That means far fewer jobs were created than previously reported.
The unemployment rate fell to 4.1 percent in July from 4.2 percent in June. As reported by the news agency AP and cited by DR, the decline happened for the wrong reasons. Some 264,000 people left the labor force, reducing competition for available positions.
Danish economists react
Kristian Skriver, head of macroeconomics at Dansk Erhverv, described the development as worse than feared in comments to Ritzau. Allan Sørensen, chief economist at Dansk Industri, went further and called it catastrophic.
Sørensen said the American job engine is doing very badly and has now shifted into reverse. Per Ritzau, the monthly payroll figure is treated as an indicator for the world economy, because the United States is the world’s largest economy measured by GDP. Europe has many companies that depend on selling goods and services to American buyers.
Danielsen placed the numbers against a strong period for the US labor market since the coronavirus lockdowns. Unemployment had been falling, and job growth had been solid. During 2026, however, the number of new jobs has been shrinking.
She said the market has now reached a turning point where job creation has become negative. There is no doubt the report is weak across the board, she added, pointing to cracks in the labor market that will need close monitoring in the coming months.
Despite the disappointing data, the week as a whole was positive for American stocks. The S&P 500 rose 3.58 percent over the week, the Nasdaq advanced 5.19 percent, and the Dow gained 2.96 percent.
DR also notes that President Donald Trump appointed Kevin Warsh as the new Federal Reserve chair in May. Trump had been dissatisfied with his predecessor, Jerome Powell, over the pace of interest rate cuts.
