Wall St Week Ahead-Jobs data, tax bill, trade on tap for rebounding US stocks

Nonfarm payrolls for May due on June 6

Fiscal legislation in focus in Washington

Rulings on Trump’s tariffs muddies trade backdrop

NEW YORK, – Key U.S. economic data, developments with federal tax-and-spending legislation and twists and turns on trade all are poised to influence equities in the coming week, with the U.S. market closing in on record highs.

The S&P 500 was set for a weekly gain with the benchmark index on Thursday ending about 4% from its February all-time high.

Investors at the end of the week were grappling with implications from legal rulings involving efforts to block most of President Donald Trump’s tariffs. Trump’s trade war has whipsawed global markets for weeks on concerns about economic fallout.

The coming week also brings a raft of economic and labor market data, headlined by the monthly U.S. employment report out on Friday.

“Now that we’re back up here not all that far from the record high, I think the hard data needs to hold in better than the market expects to really advance from here,” said Scott Wren, senior global market strategist at the Wells Fargo Investment Institute.

The employment report for May is expected to show an increase of 130,000 jobs, according to a Reuters poll of economists, which would be a step down from growth of 177,000 the prior month.

Investors have been eager to learn how Trump’s tariffs may be rippling through the economy, especially in the wake of his April 2 “Liberation Day” announcement of sweeping levies on imports.

The May data represents a full month of “how businesses have been handling some of the tariff uncertainty and some of the pressures in the market,” said Anthony Saglimbene, chief market strategist at Ameriprise Financial.

Still, an overly strong employment report, such as growth of over 200,000 jobs, might be viewed warily by the market because it could delay interest rate cuts by the Federal Reserve, said Eric Kuby, chief investment officer at North Star Investment Management Corp.

Investors have reduced bets in recent weeks on the amount of expected Fed easing this year, with about two rate cuts priced in by December, according to LSEG data.

Minutes of their latest meeting released this week showed Fed officials acknowledged they could face “difficult tradeoffs” in coming months with rising inflation alongside rising unemployment.

Fiscal legislation in Washington will also be in focus. The Senate will start considering a tax-and-spending bill passed earlier this month by the House of Representatives. Trump said this week he plans to negotiate aspects of the “big, beautiful” tax bill, a day after billionaire Elon Musk said the bill detracts from efforts to reduce the U.S. budget deficit.

The bill, which will add an estimated $3.8 trillion to the federal government’s $36.2 trillion in debt over the next decade, has focused attention on the impact of increasing deficits on the Treasury market. Rising bond yields have pressured stocks in recent weeks.

The shifting tariff backdrop also appeared likely to influence asset prices. Equities rebounded in recent weeks after Trump eased his harshest tariffs, but the situation remains in flux as Washington negotiates with trading partners.

On Thursday, for instance, stocks rose early the session after a U.S. trade court blocked many of Trump’s tariffs, but gains faded during the session. Later, a federal appeals court reinstated the tariffs, further muddying the backdrop.

“There’s initial excitement and then the reality set in that this is just another step in this process and it really hasn’t clarified very much,” Kuby said.

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