Investors were surprised by the strong jobs report for May, but will it continue?

The first of the May data was, on the surface, even better than hoped. The ISM Index did rebound from the low of April. It remains well below the breakeven level of 50, which means little expectation of rapid growth in manufacturing in the second half of the year. At least the level of activity is not dropping further. It was the employment report on Friday that provided the biggest positive surprise. Nonfarm payrolls were reported as having increased by 2.5 million while expectations had been for a decline of over 8 million. The growth in jobs was across most sectors of the economy. The unemployment rate was reported as having declined from 14.7% in April to 13.3% in May.