The stock market saw fresh buyers following the strong volatile session on Thursday as lower-than-expected nonfarm payrolls in June eased some of the pressure for two Fed rate hikes this year.
The U.S. economy added 209,000 jobs last month, falling short of expectations of 225,000, and down from 306,000 in May, but the unemployment rate fell to 3.6% and annual wage growth was 4.6%, topping expectations.
Traders estimate a 92% chance of a 25-basis-point increase in the fed funds rate this month, but the chances of another quarter-point increase by November have dropped from 40% to 34%.
Cues From Friday’s Trading:
All U.S. major averages flipped to the green after experiencing losses on Thursday. The S&P 500 gained 0.3%, while the tech-heavy Nasdaq 100 rose 0.5%.
The Dow held steady for the session, while small caps in the Russell 2000 outperformed, gaining 1.6%.
US Index Performance On Friday
Analyst Color:
“The non-dovish Fed minutes, more hawkish Fed-Speak, and hot jobs data have led to rates rising towards the high of the year,” said fund manager Louis Navellier.
He noted that bets on a July hike are now over 90%.
"After such a strong run, a pullback in stocks is not unexpected. Before the Fed’s increase in late July, we’ll see plenty of earnings which will have much more influence on third-quarter returns,” Navellier said.
Friday’s Trading In Major US Equity ETFs: In midday trading on Thursday, the SPDR S&P 500 ETF Trust (NYSE:SPY) was 0.3% higher to $441.14, the SPDR Dow Jones Industrial Average ETF (NYSE:DIA) held steady at $339.38 and the Invesco QQQ Trust (NASDAQ:QQQ) was 0.5% higher to $369.13, according to Benzinga Pro data.
The best-performing sectors for the day were the the Energy Select Sector SPDR Fund (NYSE:XLE), up 2.2%, and the Materials Select Sector SPDR Fund (NYSE:XLB), up 1.5%.
The laggards were the Health Care Select Sector SPDR Fund (NYSE:XLV), down 0.8%, followed by the Consumer Staples Select Sector SPDR Fund (NYSE:XLP), down 0.6%.
Stocks In Focus:
- Rivian Automotive Inc. (NASDAQ:RIVN) rose over 15%, on track for its eighth straight day of gains, hitting a more than six-month high as Wedbush raised the price target from $25 to $30, reflecting a better delivery outlook.
- First Solar, Inc. (NASDAQ:FSLR) rose nearly 5% after obtaining a $1-billion credit line to finance factories.
- Oil stocks rallied, with Schlumberger Ltd. (NYSE:SLB) and Halliburton Company (NYSE:HAL) soaring 7.6% and 6.7%, respectively.
- Fortrea Holdings Inc. (NASDAQ:FTRE) fell 6%, extending its weekly losses following the spin off from Laboratory Corp. of America.
Commodities, Bonds, Other Global Equity Markets:
Crude oil jumped 1.8%, with a barrel of WTI-grade crude soaring to $73. The United States Oil Fund ETF (NYSE:USO) was 1.8% higher to $65.
Treasury yields held steady rose, with the 10-year yield at 4.04% and the two-year yield at 4.92%. The iShares 20+ Year Treasury Bond ETF (NYSE:TLT) was 0.4% 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 (NYSE:UUP), down 0.8%. The EUR/USD pair, which is tracked by the Invesco CurrecyShares Euro Currency Trust (NYSE:FXE), was 0.8% higher to 1.0967.
European equity indexes closed predominantly in the green. The SPDR DJ Euro STOXX 50 Etf (NYSE:FEZ) rose 1.3%.
Gold rose 1% to $1,927/oz. The SPDR Gold Trust (NYSE:GLD) was 0.9% higher to $179. Silver rose 1.7% to $23.06, with the iShares Silver Trust (NYSE:SLV) up 1.6% to $21. Bitcoin (CRYPTO: BTC) was 1.5% higher to $30,350.
Staff writer Piero Cingari updated this report midday Friday.
Photo via Shutterstock
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