The U.S. Dollar strengthens after Non-Farm Payrolls report beats analyst forecasts.

The yield of 30-year Treasuries moved above 5.00%, the highest level since August 2007." can be paraphrased as "30-year Treasury yields surpassed 5.00%, reaching their peak since August 2007.

Highlights

• The U.S. economy gained 336,000 jobs in September.

• Traders pushed Treasury yields up as they anticipated a more aggressive approach from the Federal Reserve.

• The U.S. Dollar Index rose above 106.70 again.

On October 6, the U.S. released the Non-Farm Payrolls report, revealing that the economy added 336,000 jobs in September, surpassing the analyst consensus of 170,000. The unemployment rate remained steady at 3.8%.

According to the FedWatch Tool, there's a 71.3% likelihood that the Fed will maintain the federal funds rate in the upcoming November meeting. Traders are indicating a 38.8% probability of a 25 basis points increase in December. Interestingly, some traders are considering a 50 basis points hike, despite its low probability of just 6.8%.

The unexpectedly strong Non-Farm Payrolls report offered substantial backing to Treasury yields as bond traders prepared for a more aggressive Fed. The yield of 10-year Treasuries approached the 4.85% level, while the 30-year Treasuries' yield settled above the crucial 5.00% mark.

As expected, the U.S. Dollar Index bounced back above 106.70 as traders focused on the robust job market and rising Treasury yields.

Gold remained stagnant near the $1815 level. While increasing Treasury yields and a stronger dollar typically have a negative impact on gold, there are signs of growing demand for gold due to its status as a safe-haven asset.

In premarket trading, the S&P 500 settled below the 4250 level. The outlook for Fed policy remains the primary catalyst for stocks. The Fed is aiming to exert pressure on the job market to combat inflation, but the Non-Farm Payrolls report indicates that the job market remains robust. Therefore, the Fed may be compelled to raise the federal rate once more this year, which could have a negative effect on stocks.