Jobs data boosted optimism for the domestic economy on Friday; the unemployment fell to a rate of 3.8% and nonfarm payrolls added 223,000 jobs. The Italian government debt market had a dramatic week after short term bonds suffered their worst day since 1992; however they bounced back substantially following the President approving its new government. President Trump indicated that the summit with North Korean leader Kim Jung Un is back on for June 12 in Singapore. Trade tensions once again have picked up as Canada, Mexico and the EU are expected to retaliate from tariffs.
Domestic stocks rallied from the boost in economic sentiment on Friday and fixed income investments were lifted by a fall in interest rates. Following the sharp selloff of short term Italian debt, a flight to safety took place and lowered the U.S. 10-Year Treasury by nearly 16 basis points in a single day. Emerging market stocks are continuing to underperform thus far in 2018 due to an increase in the U.S. dollar. The increase has been fueled by the Federal Reserve raising short term interest rates which creates a higher cash yielding investment than foreign investors have elsewhere.
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