Analysis: Non-farm employment exceeds expectations, suppressing interest rate cut expectations; strong U.S. economy supports risk sentiment

According to Jinshi, the U.S. non-farm payrolls unexpectedly surged, hitting the U.S. bond market, as traders rushed to cut bets on the Federal Reserve lowering interest rates this year. Short-term government bonds were hit hardest, with the two-year Treasury yield rising by 6 basis points to around 3.51%. The money market currently expects the Fed's next rate cut to occur in July, rather than the previously anticipated June.

After the U.S. stock market closed flat, Asian stock index futures showed mixed trends. Futures indicate that the Japanese stock market will rise after reopening on Thursday following a holiday, while the Australian benchmark stock index contract saw a decline. These fluctuations suggest that the current strength of the U.S. economy is offsetting the market's desire for lower borrowing costs, supporting risk sentiment.

Bret Kenwell from eToro stated that investors should welcome the U.S. employment report, even if it gives the Fed more room to keep rates unchanged. He noted, "If the labor market does stabilize, it will be constructive for both the economy and the market."