Stocks ended higher Friday, with the S&P 500 and the Nasdaq closing at record highs, as investors picked through details of a key labor market release that could cement market bets for an autumn Federal Reserve rate cut.
The Dow Jones Industrial Average gained 67.87 points, or 0.17%, to end the session at 39,375.87, while the S&P 500 advanced 0.54% to finish 5,567.19 and the tech-heavy Nasdaq rose 0.90% to 18,352.76.
Both the S&P 500 and the Nasdaq ended the day at record highs.
All three major indexes finished the week in the green. The Nasdaq Composite advanced 3.5%, and the S&P 500 climbed nearly 2% in the period. The Dow underperformed, adding close to 0.7%, according to CNBC.
Markets were closed Thursday for Independence Day.
The Labor Department's Bureau of Labor Statistics said that a net 206,000 new jobs were created in June, down from the downwardly revised total of 218,000 recorded in May and south of this year's average of around 248,000. Economists were looking for a headline total of 190,000 in the June report.
“The increase in the unemployment rate, especially for those with at least a bachelor’s degree, suggests a modest cooling of the labor market,” said Jeffrey Roach, Chief Economist for LPL Financial. “So far, we don’t see apocalyptic signs within the labor market, but investors should be wary when the labor market is supported by government payrolls.”
Roach said that the downward revisions to the previous two months are consistent with an economic slowdown.
"We should expect more rhetoric out of the Fed about labor market conditions and the importance of keeping policy appropriate for their dual mandate," he said. "Ten-year Treasury yields were down on the news."
Updated at 12:08 PM EDT
Holding gains
The S&P 500, as well as the broader market, is holding its earlier gains heading into the mid-day session, with the benchmark last seen 16 points, or 0.29% higher while the Nasdaq gained 128 points, or 0.7%.
In the bond market, benchmark 2-year note yields were trading at 4.614%, down 7 basis points on the session, with 10-year notes pegged at 4.28%, down 6 basis points.
Related: June jobs report bolsters bets on an autumn Fed interest rate cut
Updated at 11:30 AM EDT
Cloud surfing?
Meta Platforms (META) shares are the second of the Magnificent 7 to hit a new record high Friday, rising more than 4.5% to change hands at $535.66 each.
Meta, which has surged more than 54% so far this year, will publish its second quarter earnings on July 31. CEO Mark Zuckerberg told investors on Thursday that Threads, the group's micro-blogging website, reached 175 million active users last month.
I hate to admit it but Mark Zuckerberg has swagger pic.twitter.com/dbPkYLeSUh
— greg (@greg16676935420) July 4, 2024
Updated at 10:12 AM EDT
Apple records
... and I'm not talking about The Beatles. Apple (AAPL) shares hit a fresh all-time high of $224.85 each in early Friday trading, extending their 2024 gain to around 21%, as investors continue to price-in the profit potential of its AI ambitions.
Apple shares were last marked 1.3% higher on the session at $224.50 each, a level that suggests a market value of around $3.44 trillion.
Related: Top analyst revisits Apple stock price target following AI push
Updated at 9:41 AM EDT
Mixed open
The S&P 500 was marked 4 points, or 0.07% higher in the opening minutes of trading, with the Nasdaq rising 51 points, or 0.3%. The Dow was last seen 58 points lower in relatively thin early volume.
S&P 500 Opening Bell Heatmap (Jul. 05, 2024)$SPY +0.05%🟩$QQQ +0.25%🟩$DJI -0.08%🟥$IWM -0.63%🟥 pic.twitter.com/os84dmCq7g
— Wall St Engine (@wallstengine) July 5, 2024
Updated at 8:46 AM EDT
Solid gains, slowing wages
The economy added 206,000 new jobs last month, a stronger-than-expected tally that was offset by the slowest annual wage gains in three years and added to bets on a September rate cut.
Futures turned modestly higher following the data release, with the S&P 500 priced for a 1 point gain and the Dow Jones Industrial Average called 15 points higher. The tech-focused Nasdaq is set for a 22 point bump.
Benchmark 10-year Treasury note yields were marked 4 basis points lower at 4.281% following the data release, while 2-year notes fell 5 basis points to 4.635%.
⚠️ One red flag in the US jobs report: Share of those unemployed for longer than 15 weeks rose to its highest since the pandemic. We only see this type of pattern during the early stage of a recession. Not a sell reason today. But cracks are showing & worth monitoring $USD pic.twitter.com/D6zUeTsNVb
— Viraj Patel (@VPatelFX) July 5, 2024
Updated at 8:15 AM EDT
Macy's on the make
Macy's M shares powered higher in early trading following reports that private equity firms Arkhouse Management and Brigade Capital Management have raised their takeover bid for the iconic retailer to around $6.9 billion
The Wall Street Journal has said the pair are prepared to pay $24.80 per share to take Macy's private, a 43% premium to what they were valued at when talks began in early December.
Macy's shares were last seen 8.5% higher in premarket trading to indicate an opening bell price of $19.45 each.
Macy's $M stock jumps on report investor group raised the offerhttps://t.co/Wn4koYaaLP pic.twitter.com/AyNm0pGL3o
— Streetinsider.com (@Street_Insider) July 5, 2024
Stock Market Today
Stocks extended gains over the first half of the holiday-shortened week, with the S&P 500 rising to its 33rd record of the year as megacap tech stocks drove gains for the major indexes and a pullback in Treasury yields boosted overall valuations.
Chip stocks could pace the market early again Friday as well, following an update from South Korea's Samsung. The world's biggest chipmaker forecast a big surge in operating profit for the second quarter thanks to higher semiconductor prices and the ongoing demand surge for artificial intelligence.
The session's larger focus, however, will fall on the June employment report, which is slated for 8:30 a.m. Eastern Time. It's expected to show that around 190,000 new jobs were added to the economy last month, a modest decline from the 272,000 tally recorded in May.
Wage gains, however, are expected to have eased to an annual rate of 3.9%, the slowest in three years, perhaps adding to evidence of a weakening economy and softer summer hiring intentions and add to the case for a September rate cut.
Win McNamee/Getty Images
At present CME Group's FedWatch suggests no chance of a change in Fed rates when the central bank meets later this month in Washington, but pegs the odds of a quarter-point move in September at around 74%.
Benchmark 10-year Treasury note yields were last seen trading at 4.334%, little changed from Wednesday's closing levels, while 2-year notes were trading at 4.685% heading into the job market release.
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On Wall Street, futures contracts tied to the S&P 500, which is up 16.08% for the year, are priced for a 6 point opening bell dip while those linked to the Dow Jones Industrial Average are priced for a 40 point pullback.
The tech-focused Nasdaq, which is up 21.1% for the year, are set for a 4 point gain.
Related: Analysts reset Tesla stock price targets as robotaxi event looms
Tesla (TSLA) shares were a notable early mover, rising 1.8% to a premarket price of $250.84, a level that would edge the stock into positive territory for the year.
In overseas markets, Britain's FTSE 100 was marked 0.27% higher in London following yesterday's parliamentary elections, which delivered a landslide victory for the center-left Labour Party headed by new Prime Minister Keir Starmer.
More Wall Street Analysts:
- Analyst updates Oracle stock price target after earnings
- Analyst reboots Trade Desk stock price target after Netflix deal
- Analysts adjust Micron stock price target ahead of earnings
The regionwide Stoxx 600, meanwhile, was marked 0.43% higher in Frankfurt with a focus on the second round of parliamentary elections in France this Sunday.
Overnight in Asia Japan's Nikkei 225 ended 0.003% lower in Tokyo, while the regional MSCI ex-Japan benchmark edged 0.1% higher into the close of trading.
Related: Veteran fund manager picks favorite stocks for 2024
