The stock market reversed higher Friday after the January jobs report came in much hotter than expected and Amazon.com surged on its earnings report.
Stock market indexes reversed higher. The Nasdaq composite climbed 0.8% after erasing a 0.2% loss. The S&P 500 rose 0.2%.
The Dow Jones Industrial Average fell 0.2% as Home Depot and Visa fell more than 1%. Small caps also lagged, with the Russell 2000 off 0.6%.
The Labor Department reported that U.S. employers added 467,000 jobs, a sign the economy is managing labor shortages and the effects of the omicron variant. January job gains were far above the 150,000 economists had expected. Moreover, the December job gains were revised sharply higher, from 199,000 in the initial report to 510,000.
The January unemployment rate inched up to 4%, above estimates of 3.9%. In another sign of price pressures, average hourly wage growth of 0.7% in January topped expectations for a 0.5% increase.
Stock Market Fears Larger Interest Rate Hike
The robust job gains and rising labor costs raise the chances of a larger interest-rate hike in March than the 25-basis point investors have been expecting.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 35025.55 | -85.61 | -0.24 |
| S&P 500 | (0S&P5) | 4484.21 | +6.77 | +0.15 |
| Nasdaq | (0NDQC ) | 13983.88 | +105.06 | +0.76 |
| Russell 2000 | 196.25 | -1.28 | -0.65 | |
| IBD 50 | 37.76 | -0.15 | -0.40 | |
Last Update: 10:08 AM ET 2/4/2022 |
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"Today's jobs data puts 50 basis points back on the table for the Fed's March meeting," John Lynch, chief investment officer for Comerica Wealth Management, said. The firm views the data as consistent with global cyclical recovery and supportive of value, profitable small caps and cyclical sectors.
Not even Amazon's positive earnings was enough to offset the broad stock market selling.
Several heavy-hitting earnings caused a roller coaster in the stock market this week. On Wednesday, Alphabet and Advanced Micro Devices gapped up after the companies' fourth-quarter results pleased Wall Street. Indexes climbed.
On Thursday, the stock market tanked after Meta Platforms missed views and gave a weak outlook. The parent company of Facebook plummeted more than 26% in a historic sell-off: It was the largest one-day loss of market capital for any U.S. company.
Amazon, Snap Earnings Positive For Stock Market
But late Thursday, bulls won after Amazon rallied on mixed fourth-quarter results. Earnings topped expectations but missed revenue estimates. Adjusted earnings of $27.75 a share soared 97% from a year ago, as revenue of $137.4 billion marked a 9% increase. The stock leapt more than 10% in big volume.
Snap soared 48% after the parent of Snapchat beat fourth-quarter expectations and provided a forecast above views. Earnings of 22 cents a share marked the company's first profitable quarter. Revenue jumped 42% to $1.3 billion.
The stock climbed to the highest since Jan. 20 and boosted social media stocks, which got slammed Thursday on Meta Platform's meltdown. Global X Social Media ETF rose 2.6%.
The energy sector continues to provide some opportunities, and Friday morning Coterra Energy broke out from a cuplike base. The exploration and production company is in buy range from the 23.74 buy point. It is one of a dozen stocks in the group with 99 Composite Ratings.
This morning, drugmakers Bristol Myers Squibb and Regeneron reported earnings.
Regeneron rose 1.2% after beating sales and profit estimates. Its Covid-19 antibody cocktail brought in $2.3 billion in sales, which provided a major part of the quarter's revenue.
Bristol Myers Squibb beat profit estimates but missed sales expectations. The stock climbed 1.5% and is close to the 65.95 buy point of a cup with handle base.
Bristol Myers was the best performing stock in the Innovator IBD 50 ETF, which was down 0.6%.
