US job growth surges past forecasts in May, sending shockwaves through global markets and intensifying pressure on the Federal Reserve to tighten policy before year-end. The Labour Department reported on Friday that non-farm payrolls expanded by 172,000 in May, more than doubling the 80,000 increase economists had anticipated and underscoring the resilience of the world’s largest economy despite geopolitical headwinds. Traders immediately priced in a near-certainty of a December rate hike, with fed funds futures implying a 68% probability of at least a 25-basis-point increase by the December Federal Open Market Committee meeting .
The robust labour data arrived as chipmakers led a broad equity retreat, with semiconductor giant Broadcom’s disappointing outlook triggering a two-day sell-off that erased gains across US and European benchmarks. The Nasdaq-100 underperformed, falling deeper into negative territory after the company’s forecast miss, while the DAX in Frankfurt closed down 0.4% as investors weighed geopolitical risks in Ukraine and the Middle East . European shares remained subdued, with the Stoxx 600 little changed as energy and financials lagged behind gains in Spanish equities, where the Ibex 35 hit fresh records driven by Inditex .
Against this backdrop, Elon Musk’s SpaceX is preparing for what could be the largest initial public offering in history, with plans to list 555.6 million shares at $135 each, valuing the company at $75 billion. The IPO, which could begin as early as next week, has already drawn tens of thousands of UK retail investors, with more than 30,000 small investors registering interest in the offering . However, the company has barred investors from China and Hong Kong from participating, according to Bloomberg News . Oddo BHF strategist Oliver Roth told *Welt* that the IPO’s scale and the involvement of major banks could drive short-term momentum, despite SpaceX’s persistent losses .
Commodity markets showed tentative signs of stabilisation, with the UN’s Food and Agriculture Organisation reporting a 0.2-point dip in its May Food Price Index, halting a recent upward trend . Meanwhile, UK house prices fell for a third consecutive month in May, reflecting lingering uncertainty from the Iran conflict and tighter mortgage conditions . Retailers, however, reported a rebound in footfall as warm weather lured consumers back to high streets, offering a rare bright spot in an otherwise cautious economic landscape.