Live stock market news updates: Stocks top Friday higher, week lower after jobs report

Live stock market news updates: Stocks top Friday higher, week lower after jobs report

U.S. stocks were firmly up on Friday but down for the week as traders weighed monthly jobs numbers which did little to thwart the likelihood of more aggressive monetary tightening and weighed talks that China might ease COVID restrictions.

The S&P 500 (^GSPC) rose 1.4%, while the Dow Jones Industrial Average (^DJI) jumped more than 400 points, or about 1.3%. The technology-focused Nasdaq Composite (^IXIC) posted a gain of roughly the same order of magnitude. Still, all three major averages were down for the week. The Dow ended lower for the first time in five weeks.

The U.S. economy added 261,000 jobs in October, while the September reading was revised up to 315,000 from 263,000 previously reported, the Labor Department said Friday. Economists had expected a payroll gain of 195,000 last month, according to consensus estimates compiled by Bloomberg. The unemployment rate climbed to 3.7%.

“Today’s stronger-than-expected report illustrates the difficult task ahead of the Fed as it battles a resilient labor market and persistent inflation,” said Mike Loewengart, head of portfolio construction. models to Morgan Stanley’s Global Investment Office, in email comments. “While the number may be disappointing for investors hoping for a dovish Fed sooner rather than later, keep in mind that this is the lowest reading in nearly two years, so there could be some signs of a market slowdown.”

Investors bet some signs of a cooling labor market would force the Federal Reserve to scale back its aggressive rate-hike campaign, but Chairman Jerome Powell said Wednesday that mild moderations in the data were not enough to a pause on increases, with labor conditions still historically tight.

“Although job vacancies have fallen below their peaks and the pace of job gains has slowed since the start of the year, the labor market continues to be unbalanced, with demand far outstripping supply for available workers,” Powell said on Wednesday after the U.S. central bank issued a fourth straight interest rate hike of 75 basis points.

In the third quarter of this year, payroll gains averaged 372,000 per month. Weekly jobless claims, the most current snapshot of the U.S. labor market, have also been consistently weak, with this week’s reading at 217,000.

“Initial claims are not increasing at all,” DataTrek’s Nicholas Colas said in a note. “Put simply, there is still no sign that either the Fed’s aggressive monetary policy or the tightening of financial conditions it has brought about are still hitting U.S. labor markets.”

Central banks around the world have followed suit with the US Federal Reserve in pursuing a combative course of monetary tightening, raising concerns about the impact of synchronized rate hikes. The Bank of England raised interest rates by 75 basis points on Thursday, while European Central Bank President Christine Lagarde said in recent remarks that rates may need to be raised to restrictive levels to bring inflation back to the 2% target.

As monetary policy captured investors’ attention this week, corporate earnings continued to surge. Shares of Block (SQ) jumped 11% after the company significantly beat estimates on the strong performance of its Cash App and Square payment offerings.

Payments peer PayPal (PYPL), meanwhile, saw its shares fall almost 2% after the company cut its revenue forecast to 8.5% from its earlier outlook of 18%, while even as she beat her results.

Shares of Twilio (TWLO) fell 35% after the cloud communications company missed its earnings and announced weaker-than-expected guidance.

Shares of toymaker Funko (FNKO) plunged nearly 60% after the company announced a big shortfall and cut its annual forecast ahead of the holiday season.

Meanwhile, shares of Alibaba (BABA) gained 7% with a broad rally in Chinese stocks amid speculation the country will end its strict zero-COVID policy.

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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