NEW YORK (AP) – On Friday, Amazon led U.S. stock indexes higher. The S&P 500 rose 0.4% to recover some of its loss from the previous day, which was its worst in eight weeks. The Dow Jones Industrial Average added 288 points, or 0.7%, while the Nasdaq composite gained 0.8%. Amazon climbed 6.2% after delivering a bigger profit for the latest quarter than analysts expected and was the strongest force pushing the S&P 500 higher. Meanwhile, Intel rallied 7.8% despite reporting a worse loss than expected. Its revenue topped analysts’ estimates, and it gave a forecast for results in the current quarter that likewise topped expectations. A surprisingly weak jobs report marred by some unusual occurrences cemented bets on Wall Street for another cut to interest rates next week.
Cardinal Health was among the market’s significant gainers, jumping 7% after exceeding analysts’ forecasts for profit and revenue in the latest quarter. It also raised its profit forecast for its fiscal year, currently in its second quarter. Meanwhile, Apple slid 1.2% as it expects revenue growth in the crucial holiday quarter to be in the low to mid-single digit percentages, falling short of several analysts’ forecasts. Overall, the S&P 500 rose 23.35 points to 5,728.80. The Dow gained 288.73 to 42,052.19, and the Nasdaq composite added 144.77 to 18,239.92. In the bond market, Treasury yields moved higher following fluctuations after a highly anticipated report indicated that U.S. employers added only a net 12,000 workers to their payrolls last month, significantly less than the 115,000 hiring expected by economists or the 223,00 jobs created in September.
The Federal Reserve is widely anticipated to reduce its main interest rate by a quarter of a percentage point next week, a consensus that was further solidified by the recent weaker-than-expected jobs report, which eliminated any lingering hopes of the Fed maintaining current rates, as per CME Group data.
In September, the Fed initiated its rate-cutting campaign with an unusually large reduction of half a percentage point, reflecting a shift in focus towards sustaining a robust job market rather than solely targeting inflation reduction.
The two-year Treasury yield, a key indicator of anticipated Fed actions, initially dropped post-jobs report but subsequently rebounded to 4.20% from 4.18% as of late Thursday. Similarly, the 10-year Treasury yield, which factors in future economic growth and other variables, also experienced a brief dip followed by an increase.
The stock market experienced a significant rise today, with Amazon leading the charge. The market climbed to 4.37%, up from 4.29% late Thursday.
Economists have noted that Friday’s jobs report contained a lot of noise and perhaps not much signal. Factors such as two hurricanes that left destructive paths across the United States during the month, along with a strike by workers at Boeing, contributed to the difficulty in interpreting the numbers. Despite these distortions, Scott Wren, senior global market strategist at Wells Fargo Investment Institute, stated, “but it doesn’t change our view that the labor market should further decelerate in coming months.”
The hope on Wall Street is that the economy will still avoid a recession, even with the expected slowdown in the job market. This optimism is partly due to anticipated cuts to interest rates by the Fed. So far, the overall economy has remained more resilient than initially feared.
A separate report on Friday mentioned…
The U.S. manufacturing sector experienced a contraction last month that exceeded economists’ expectations, marking it as one of the most affected areas by the Federal Reserve’s decision to maintain interest rates at a two-decade high until September.
In global stock markets, European indexes saw an uptick following a decline across much of Asia, with the exception of Hong Kong.
Additionally, oil prices continued their recovery, trimming weekly losses. The price of a barrel of U.S. benchmark crude oil increased by 0.4%, while Brent crude, the global benchmark, also rose by 0.4%.
Contributed by AP Writers Matt Ott and Zimo Zhong.
