Wall Street has no direction after strong U.S. jobs data


The New York Stock Exchange closed divided on Friday, with indexes initially reacting negatively to the news after a strong and surprising U.S. jobs data, as it could be synonymous with future rate hikes.

The Dow closed at 32,803.47 (+0.23%) and the Nasdaq lost 0.50% to 12,657.55 after falling 1.30% during the session. The S&P 500 fell 0.16% to 4,145.19.

Briefing.com’s AFP Patrick O’Hare explained to AFP’s Patrick O’Hare that the market appears to have “rationalized its first impulse response” to announcing the creation of 528,000 jobs shortly before the opening , and the market had collapsed when July was forecast at 250,000 jobs.

Investors ultimately “believe that these data show that the economy can withstand” monetary tightening by the central bank (Fed).

“Another thought is that the jobs report is a lagging indicator” showing activity that has passed and “other reports will follow”, especially inflation (CPI) next week.

The fact remains that the stock market is unhappy with the surge in hiring, the unemployment rate falling 0.1 percentage point to 3.5%, and most importantly the rise in hourly earnings (+5.2% y/y) as investors worry that the central bank may tighten the currency further policy to quell an overheated economy fueling inflation.

“These numbers are definitely stronger than expected. After the Fed’s last meeting in July, the market had the idea that it was going to change its stance and cut rates,” explained TD Securities’ Mazen Issa.

“But these numbers run counter to this version and are more evidence of an economy that needs to be restrained,” he added.

– Interest rates are tight –

Bond yields rose sharply, pushing the dollar higher.

At 7:00pm GMT, the 10-year note rate was at 2.82%, compared with 2.68% the day before, and the two-year note rate jumped from 3.04% to 3.24%, the highest since July 20. before the last Fed meeting.

However, five of the 11 S&P sectors closed in the green compared to the opening, notably energy (+2.04%), while crude oil prices edged higher on Friday.

US media and streaming giant Warner Bros Discovery was penalized (-16.53%), and HBO’s parent company reported lower-than-expected turnover and blamed losses.

Tesla shares fell 6.63% to $864.51 as its shareholder meeting approved an impending triple split.

The legal battle brewing with Twitter has also taken a new turn as Elon Musk ditched plans to take over the social network. The billionaire accused Twitter in court of “fraudulent” in the number of users it can profit from.

Twitter shares rose 3.56 percent to $42.52.

Meta (Facebook) fell 2.03% to $167.11, announcing the day before it launched the first large-scale loan on the market for the first time in its history.

The group also decided to temporarily suspend its acquisition of virtual reality specialist Within after the U.S. competition watchdog, the FTC, was not optimistic about the acquisition.

Uber’s self-driving car rental rival Lyft rose 16.62 percent to $20.28, its best ever, after ridership returned to pre-pandemic levels and it reported a quarterly profit.

Over the past week, the Dow Jones index was basically stable (-0.13%), the tech-heavy Nasdaq rose 2.15%, and the S&P 500, the most representative index in the US market, edged down 0.36%.

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