Employment Report Dampens Rate Cut Expectations! U.S. Stocks Still Near Historic Highs, Cryptocurrency Market Plunges

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Strong Job Growth in the U.S. Exceeds Expectations

In May, the U.S. economy added a significant number of job opportunities, surpassing expectations and dispelling concerns of a potential slowdown in the labor market. This development might reduce the motivation for the Federal Reserve (FED) to lower interest rates in the short term.

According to data from the U.S. Department of Labor's Bureau of Labor Statistics, nonfarm payrolls in May increased by 272,000, a substantial growth compared to 165,000 in April and well above the estimated 190,000. Despite the strong job growth, the unemployment rate rose to 4%, surpassing this level for the first time since January 2022. Economists had anticipated the figure to remain at 3.9% from April.

Dampening Rate Cut Expectations, U.S. Stocks Remain Stable

The three major U.S. stock indices were not affected, with the previous trading day closing near historic highs. IBM Vice Chairman and former Director of the U.S. National Economic Council Gary Cohn stated, "At the end of the day, it's all about the economy, it's about GDP growth, it's about corporate profits, it's about consumer health, and in the long run, that's going to win."

Crypto Market Plunge: Bitcoin Dips Below 69K, ETH 3600, Intense Competition among Altcoins

According to CoinMarketCap, the top ten cryptocurrencies experienced a widespread decline. Bitcoin briefly dropped below 69K, ETH fell to 3600, and the approval of spot ETFs by the SEC due to uncertain attitudes towards S-1 was delayed once again. BNB, after reaching new highs, fell below the 700 level.

Meme coins also experienced volatility, but only saw a slight decrease compared to the price surge:

Crypto's Lack of Physical Economic Support

The rate cut expectations are speculative factors in the market, and changes in expectations can bring strong volatility to the market. In the face of negative developments, U.S. stock companies remain unaffected due to the strong support of their physical economy. However, the cryptocurrency market, with a significant disparity between the scale of the physical economy and token market value, lacks resilience in the face of negative developments relying solely on speculative expectations.