The stock market may be misreading what this weak jobs report means for the Fed

The stock market may be misreading what this weak jobs report means for the Fed

The much-weaker-than-expected April jobs report reinforces the Federal Reserve's easy policy stance, but some strategists still expect the central bank to signal in the next couple of months that it will slow down its bond buying.

Economists had expected 1 million jobs were added last month, so the government's report of just 266,000 was a gut punch to the view that the economy is rebounding in a smooth upward trajectory. The anticipation for a big jobs number also had put the spotlight on the Fed's easing programs.

Stock futures rose and Treasury yields immediately fell after the report. But the 10-year Treasury yield, after falling to about 1.49% turned around to trade at 1.55%. The 5-year also fell but it stayed near its low. Yields move opposite bond prices. At last check, stocks remained higher in afternoon trading with the Dow up about 150 points.

"I'm wondering if bonds are selling off a little as it just reinforces [Fed Chair Jerome] Powell wanting to be patient," said John Briggs, head of global strategy at NatWest Markets. "But if you're like me, waiting for the Fed to taper, I think the Fed is going to start talking about it in September. That means the