Stocks Rebound After Booming Jobs Data, Treasury Yields Near 5%, S&P 500 Set To Snap 4 Weeks Of Declines: What's Driving Markets Friday?

Wall Street staged a robust rebound Friday, driven by a significantly stronger-than-expected labor market report that reignited investor confidence in the strength of the U.S. economy.

Non-farm payrolls rose by 336,000 last month, far outpacing estimates of 170,000, and rising from an upwardly revised 227,000 in August. The outcome marked the strongest payrolls increase since January 2023.

Immediate market reactions saw 30-year Treasury yields breaking above 5% before retracing back to 4.92% by midday trading in New York.

All equity indices sharply rallied substantially despite economists warning the strong job report may keep the Fed on a tightening mode.

Cues From Friday’s Trading:

The S&P 500 surged by 1%, potentially bringing an end to its four-week losing streak.

The Nasdaq 100 exhibited even stronger performance, rallying by 1.3%, resulting in a weekly gain of the same magnitude.

The Dow, while showing relative underperformance, managed to gain 0.7% on the day. The index is still down by 0.5% for the week.

The Russell 2000 inched 0.8% higher but remained more than 2% lower for the week.

US Index Performance On Friday

Analyst Color:

Chris Zaccarelli, chief investment officer at Independent Advisor Alliance, expressed surprise at the significant deviation of the nonfarm payrolls report from expectations.

This unexpected jump in the NFPs is likely to exert additional pressure on the Federal Reserve to consider raising interest rates at its upcoming meeting, according to the expert.

Despite the rapid increase in interest rates over the last year-and-a-half, the job market continues to thrive and consumers remain resilient, Zaccarelli said.

Friday Trading In Major US Equity ETFs

• The SPDR S&P 500 ETF Trust SPY was 0.9% higher to $428.56.
• The SPDR Dow Jones Industrial Average ETF DIA rose 0.8% at $333.84.
• The Invesco QQQ Trust QQQ rose 1.3% to $363.23, according to Benzinga Pro data.

Looking at S&P 500 sector ETFs:

• The Technology Select Sector SPDR Fund XLK outperformed by rising 1.5%.
• The Consumer Staples Select Sector SPDR Fund XLP was the laggard, down 1.1%.

See Also: What Are Future Contracts

Stocks In Focus:

• Levi Strauss & Co. LEVI moved down more than 5% following the release of its quarterly results.
• AMC Entertainment Holdings Inc. AMC rallied on strong pre-sales data about the upcoming Taylor Swift’s concert film.
• Pioneer Natural Resources Company PXD jumped over 11% in reaction to a Wall Street Journal report that said the company is nearing a $60-billion deal to be bought by Exxon Mobil Corp. XOM.

Commodities, Bonds, Other Global Equity Markets:

Crude oil ticked 0.1% up, with a barrel of WTI-grade crude trading at $81. The United States Oil Fund ETF USO was 0.1% higher to $74.  

Treasury yields were higher, with the 10-year yield up by 6 basis points to 4.78% and the 30-year yield up by 6 basis points to 4.94%. The iShares 20+ Year Treasury Bond ETF TLT was 0.8% lower for the day. 

The dollar fell, with the U.S. dollar index, which is tracked by the Invesco DB USD Index Bullish Fund ETF UUP, down 0.2%. The EUR/USD pair, which is tracked by the Invesco CurrecyShares Euro Currency Trust FXE, was 0.4% higher to 1.0587.

European equity indices had a strong green session. The SPDR DJ Euro STOXX 50 ETF  FEZ rose 1.5%. 

Gold edged 0.6% up to $1,831/oz, while silver rose 3% to $21.58. Bitcoin BTC/USD was 1.7% higher to $27,888.

Staff writer Piero Cingari updated this report midday Thursday. 

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