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Market Update

More Jobs: Good for the Economy, a Boon for Stocks

Employment and wages aren't usually main market indicators for investors, but perhaps they should be.

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It was another big month for employment gains in July, with the U.S. economy adding 255,000 jobs. That comes on the heels of June's massive gains, when 292,000 jobs were added. In addition, wage growth has grown about 2.6% year over year. Naturally, this is positive news for the economy: More people working and making more money usually means more spending, and that helps GDP growth.

Both job and wage growth can be boons to stock markets, too. Employment and wages are not usually main market indicators for investors, but perhaps they should be.

Bryan Borzykowski does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.