US Economy Adds 261,000 Jobs In October, And It's Showing No Signs Of Cooling

The SPDR S&P 500 ETF Trust SPY traded higher Friday morning after the Labor Department reported strong U.S. jobs market numbers from October.

What Happened: The U.S. added 261,000 jobs last month, beating average economist estimates of 205,000 jobs.

New data from the Bureau of Labor Statistics showed the U.S. unemployment rate is at 3.7%, missing the 3.5% level economists had projected. The labor participation remained unchanged at 62.2%, compared to the 63.4% pre-pandemic rate in February 2020.

Wages were up 4.7% year-over-year and increased 0.4% from September. The health care industry led the job creation in October, adding 53,000 total positions.

The Labor Department also revised August's total job growth lower by 23,000 jobs to +292,000 and September's job growth higher by 52,000 jobs to +315,000. The combined revisions totaled 29,000 additional jobs.

Why It Matters: The Federal Reserve is paying close attention to the jobs market as the central bank aims to cool the hottest inflation numbers in more than 40 years.

The Fed hiked interest rates by 75 basis points for the fourth time in five months this week, bringing its target fed funds rate up to a range of 3.75% to 4%.

The Consumer Price Index (CPI) was up 8.2% in September, down from a 2022 peak of 9.1% in June.

Friday's strong jobs report could signal the Fed will hike rates another 0.75% in its next meeting in December.

SPY Price Action: The SPDR S&P 500 was trading 1.1% higher at $374.58 in Friday's premarket session.