Both the S&P 500 ETF (SPY) and the Nasdaq 100 ETF (QQQ) finished Monday’s trading session in positive territory, reversing a tumultuous Friday session.
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On Friday, President Trump announced that he would fire Bureau of Labor Statistics (BLS) Commissioner Erika McEntarfer after the agency announced that it had overstated May and June’s nonfarm payrolls (NFP) by 285,000 jobs. July’s NFP came in at 73,000 jobs, well below the consensus estimate of 110,000 jobs. Over the weekend, Trump said that he would name the new BLS Commissioner over the coming days.
Trump is also set to name a replacement for Fed Governor Adriana Kugler after she unexpectedly announced her resignation. Kugler is a member of the Federal Open Market Committee, which sets the federal funds rate.
Following Friday’s nonfarm payrolls blunder, the odds of a 25-bps rate cut at the September 16-17 Federal Open Market Committee (FOMC) spiked to 80.3%, according to CME’s FedWatch tool. Those odds are still rising, tallying in at 92.1% on Monday.
On the trade front, Trump said in a Truth Social post that he will “substantially” raise the tariff on imported goods from India, accusing the country of purchasing Russian oil and then selling some of it in order to turn a profit. In response, India said that it purchases Russian oil in order to support predictable prices for consumers. The country has been subject to a 25% tariff since August 1. “They don’t care how many people in Ukraine are being killed by the Russian War Machine,” said Trump.
Meanwhile, the European Union has agreed to suspend countermeasures against U.S. tariffs for six months as the two sides work to secure a comprehensive deal. The U.S. and EU agreed to a mini trade deal last week that will see imported EU goods tariffed at 15%.
Trade progress with China is also advancing, with a rare earth agreement between the countries “about halfway there,” said U.S. Trade Representative Jamieson Greer, adding “We’re focused on making sure that magnets from China to the United States and the adjacent supply chain can flow as freely as it did before the control.”
The S&P 500 (SPX) closed with a 1.47% gain while the Nasdaq 100 (NDX) returned 1.87%.
