Dow hits record high, and the markets shake off a worse-than-expected April jobs report. Plus, a bitcoin millionaire offers advice about investing in cryptocurrency. Here's how the headlines could affect your money.
Stocks climbed Thursday, with the Dow adding 0.9% to reach a record close. The S&P rose 0.8%, and the Nasdaq gained 0.4%. The major indexes continued climbing Friday morning as traders shook off a disappointing jobs report.
Only 266,000 nonfarm payroll jobs were added in April, and the unemployment rate rose to 6.1%, according to Labor Department data. Economists had predicted the addition of 1 million jobs to the market and expected the unemployment rate to dip to 5.8%.
Economists attribute the disappointing report to a shortage of available workers (many are discouraged from their experiences job hunting over the last year or waiting to be fully vaccinated).
"I think this is just as much about a shortage in labor supply as it is about a shortage of labor demand," Jason Furman, an economist at Harvard University and a former Obama administration advisor, told CNBC. "If you look at April, it appears that there were about 1.1 unemployed workers for every job opening. So there are a lot of jobs out there, there is just still not a lot of labor supply."
The continuation of remote learning might also be affecting who can go back to work, David Leonhardt, a writer at The New York Times, tweeted.
As the total market value of digital currency tops $2 trillion, you might be wondering if you should invest in cryptocurrency. Bitcoin millionaire Grant Sabatier says if you do, be careful. "I still don't recommend that new investors — anyone with less than $25,000 to invest — invest in cryptocurrency," he says.
Cryptocurrency doesn't have a long track record, and buying any is a gamble, Sabatier says. He and other experts recommend allocating a majority of your portfolio to diversified, low-cost funds. If you want to include cryptocurrency, he suggests that it represent no more than 1%-5%.
Video by Courtney Stith
Nonfarm payrolls are what the Bureau of Labor Statistics is counting when it calculates new job and unemployment figures for the monthly jobs report. According to the BLS, nonfarm jobs include all roles except "the economic activities of the following: general government, private households, nonprofit organizations serving individuals, and farms." Economists monitor nonfarm payrolls as a measure of the country's economic health.
Although the daily news can have an impact on your wallet, remember to take a long-term outlook when it comes to decisions on spending, saving, and investing.
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