By US stocks jumped on Friday after the October jobs report missed economist estimates, opening the door for more rate cuts from the Federal Reserve.
The US economy added 12,000 jobs in October, well short of economist estimates of 106,000, representing the lowest job gains since December 2020. The unemployment rate remained unchanged at 4.1%.
The weak jobs report reinforced the case for more interest rate cuts from the Fed.
“The Fed will likely cut rates in the remaining two meetings as economic conditions weakened,” LPL chief economist Jeffrey Roach said.
The jobs report’s weakness was driven by disruptions from hurricanes Helene and Milton, which battered Florida and North Carolina last month.
The ongoing strike of about 30,000 Boeing union members also weighed on the report.
Here’s where US indexes stood shortly after the 9:30 a.m. opening bell on Friday:
- S&P 500: 5,739.46, up 0.59%
- Dow Jones Industrial Average: 41,955.92, up 0.46% (+192.46 points)
- Nasdaq composite: 18,208.88, up 0.63%
Interest rates fell immediately following the weak data, with the 10-year US Treasury yield dropping to a low of 4.229% before rebounding slightly.
The fact that the jobs report missed estimates but did not include a rise in the unemployment rate was encouraging, according to Bryon Anderson of Laffer Tengler Investments.
“The unemployment rate not increasing again is a good sign for the economy and breaks the Sahm rule everyone was panicking about a couple months ago. Hourly earnings increases are still increasing at a healthy pace so we still have confidence in the economy,” Anderson,
Investors were also digesting earnings results from mega-cap tech giants Amazon and Apple. Both companies beat analyst estimates, with Amazon stock surging about 7%.
Meanwhile, Apple stock was down after earnings as weakness in its China business weighed on sentiment, with the stock dropping about 2%.
Here’s what else is going on:
- Carvana stock has soared more than 7,000% since it narrowly avoided bankruptcy in 2022.
- The US economy is in for a double shock if Trump is elected president, Paul Krugman said.
- Wealthy sports fans can now put money into investments tied to their favorite leagues.
In commodities, bonds, and crypto:
- West Texas Intermediate crude oil rose 2.69% to $71.12 a barrel. Brent crude, the international benchmark, was higher by 2.36% to $74.53 a barrel.
- Gold jumped 0.76% to $22,770.10 an ounce.
- The 10-year Treasury yield declined 2 basis points to 4.269%.
- Bitcoin increased 0.05% to $70,245.
