NEW YORK: Wall Street gained and bond yields fell on Friday after July jobs data showed a slowing in the US labor market with wage gains.
US employers added 187,000 jobs in July, according to the Labor Department’s employment report on Friday. Data for June additions was revised lower to 185,000 jobs, from 209,000 reported previously.
“There’s been this building narrative as of recent.. (that) the soft landing is a sure thing, the economy is not going to slow materially”, said Charlie Ripley, senior investment strategist for Allianz Investment Management in Minneapolis, “Loosening up of the labor market is a sign that shows that the economy is slowing to some extent.”
Average hourly earnings rose 0.4% in July, unchanged from the previous month, exceeding expectations, taking the year-on-year increase in wages to 4.4%.
The yield on the 10-year benchmark note dipped on Friday after the jobs data, but still remained above 4%, partly boosting some megacap stocks.
“This buildup that nonfarm payrolls were going to exceed expectations - Clearly, it didn’t - drove the rest of the bond market that we’re seeing”, said Ripley,”we are kind of seeing equity market reaction to that as well. It’s a little bit more bullish for equities.” Giving solid boost to the S&P 500 index, Amazon.com shares surged 10.5% after the company issued an upbeat third-quarter outlook. Apple’s shares dipped 3.2% as the iPhone maker forecast a continued slide in sales.
Shares of peers Microsoft, Alphabet and Snowflake rose between 1% and 5% after Amazon’s cloud business segment beat sales estimates.
At 1:53 p.m. ET, the Dow Jones Industrial Average rose 192.75 points, or 0.55%, to 35,408.64, the S&P 500 gained 23.17 points, or 0.51%, to 4,525.06 and the Nasdaq Composite added 120.23 points, or 0.86%, to 14,079.94.
All three major indexes were on course to end the week lower, with the tech-heavy Nasdaq leading losses.
Stocks closed marginally lower on Thursday, weighed down by the last batch of economic data and some disappointing earnings.
Of the 422 companies in the S&P 500 that have reported quarterly earnings as of Friday, 79.1% have beat analysts’ estimates, according to Refinitiv data.
Carl Icahn-owned investment firm Icahn Enterprises shed 23.3% after the company halved its quarterly payout, months after short-seller Hindenburg Research accused it of operating a “Ponzi-like” structure to pay dividends.
Fortinet tumbled 24.4% after the cybersecurity firm cut its annual revenue forecast as spending from enterprise clients remained tight amid a turbulent economy.
Shares of Tupperware, known for its plastic airtight storage containers and bowls, rallied 48.3% after the company finalized an agreement with its lenders to restructure its debt obligations in an effort to turn around the business.
Amgen added 6.4% after it reported a higher quarterly profit on strong sales of its cholesterol, osteoporosis and other drugs.
DraftKings’ shares rose 2% after the sports-betting firm raised its fiscal year 2023 revenue outlook.
Advancing issues outnumbered declining ones on the NYSE by a 2.89-to-1 ratio; on Nasdaq, a 1.63-to-1 ratio favored advancers.
The S&P 500 posted 19 new 52-week highs and 6 new lows; the Nasdaq Composite recorded 52 new highs and 69 new lows.
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