Wall Street surges after economy adds just 175,000 jobs in April, fueling hopes of rate cuts

US stocks soared higher on Friday morning after new data showed that US job growth slowed considerably last month.

The Dow opened more than 530 points higher, the S&P was up 1.2% and the Nasdaq Composite gained 1.8%.

The US added just 175,000 new jobs in April, according to Bureau of Labor Statistics data released Friday. That’s far below economists expectations for 235,000 jobs and the 315,000 jobs added in March. The unemployment rate ticked higher as well, to 3.9% from 3.8% the month before.

While that’s bad news for Main Street, Wall Street celebrated the news.

That’s because the Federal Reserve is working to slow the economy by hiking interest rates — the only tool it has to fight inflation. A still-robust job market means the central bank could continue to keep rates elevated without fear of sending the economy into a recession. If the labor market weakens, the Fed is more likely to consider a rate cut.