Stocks rose Friday after a soft jobs report drove bond yields lower to cap the stock market’s best week in 2023.
The Dow Jones Industrial Average gained 305 points, or 0.9%. The S&P 500 climbed 1.1%, and the Nasdaq Composite advanced 1.4%.
Equities are on pace for sizable weekly gains as investors grow hopeful that the Federal Reserve’s rate-hiking campaign is over. As of Thursday’s close, the Dow is up 5%. The S&P 500 is tracking for a 5.6% advance on the week, while the Nasdaq is up 5.8%.
Dow Jones Industrial Average
The October jobs report on Friday came in weaker than expectations, showing the Fed’s attempt to cool the economy and stifle inflation could be working. The U.S. economy last month added 150,000 jobs, below the 170,000 payrolls increase consensus estimate from Dow Jones, and lower than September’s blowout of 297,000 jobs added. The unemployment rate rose to 3.9%, compared to expectations that it would hold steady at 3.8%.
Average hourly earnings also missed expectations on a monthly basis, rising 0.2% in October, below the anticipated 0.3% increase.
“From an equity market perspective, this reading takes some of the pressure off inflation and interest rate concerns, while still reflecting a robust labor market that is adding jobs faster than the neutral rate of approximately 100K,” said Michelle Cluver, portfolio strategist at Global X.
Bond yields, which have weighed on the stock market the last three months, tumbled Friday in the wake of the worse-than-expected payrolls figures and lighter average hourly earnings increase. The 10-year Treasury yield lost more than 9 basis points to 4.57%, down from the 5% high it hit last month. The 2-year Treasury yield lost 7 basis points to 4.9%.
Yields and prices move in opposite directions. One basis point equals 0.01%.
U.S. 10-year Treasury
Apple fell 1.5% after the iPhone maker issued a weak revenue outlook for the December quarter. Though the company beat on the top and bottom lines in its fiscal fourth quarter, overall sales declined for the fourth quarter in a row. Elsewhere, Block popped 16% on an earnings beat and a raise on full-year guidance, while Paramount Global jumped 4.5% on a strong quarterly report.
— CNBC’s Jeff Cox, Alex Harring and Chris Hayes contributed reporting.