US unemployment fell in June as non-farm payrolls added 4.8 million jobs, the Labor Department said.
It was the second month of gains after a loss of more than 20 million in April, when the coronavirus pandemic put a large swath of economic activity on ice.
The unemployment rate was 11.1%. Economists had been expecting a 2.9 million increase and a jobless rate of 12.4%.
The figures were released a day early as it is a public holiday tomorrow for Independence Day.
In London stocks pushed higher with the FTSE 100 up 71 points at 6228.47. US stock futures on Wall Street also moved higher.
News Conference at 9:30. Great Jobs Numbers!— Donald J. Trump (@realDonaldTrump)July 2, 2020
Last month in May the economy added 2.5 million jobs. The data surprised everyone as financial analysts had anticipated that 8 million jobs would be lost.
Richard Flynn, managing director at Charles Schwab, said: "Today's upbeat US jobs report will build upon the market's positive momentum from last month's data.
"However, even if the number is trending lower, continued jobless claims over the past few weeks suggest that many job losses may become permanent as businesses struggle to reopen and unused resources and skills become outdated.
"It's also possible that a labour market recovery may be further endangered by the latest spike in infection rates in various states. In the US, demographic data from the Center for Disease Control shows that new cases in May and June are skewing towards those that are younger, rather than towards the older portion of population as seen back in April and in months prior. While daily stock market volatility in recent weeks may be influenced in part by the rising number of cases, the overall trend in stocks seems more closely aligned with deaths than new cases.
"A second wave of deaths could in turn lead to a second wave of decline for the economy, corporate earnings and the stock market. Watching the number of deaths, rather than new cases, will be critical for investors in the weeks ahead."
Neil Birrell, chief investment officer at Premier Miton, added: “The US jobs data came in much better than expected. Although, it is not as good as face value given incorrect classifications.
"But, no matter, risk assets will continue to benefit from the significantly improving economic trends as the US population gets back to work and spending.”