Stock market today: Nasdaq, S&P 500 rebound amid Amazon cheer, jobs report
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US stocks jumped, set for a comeback on Friday as investors digested a big miss in the monthly jobs report, and welcomed Amazon (AMZN) and Intel (INTC) earnings.
The tech-heavy Nasdaq Composite (^IXIC) surged 1%, while the S&P 500 (^GSPC) rose 0.8%, both coming off a steep selloff fueled by worries about Big Tech's AI spending. The Dow Jones Industrial Average (^DJI) added roughly 0.8%.
Markets took in their stride the disappointing headline numbers in the all-important jobs report. The US economy added just 12,000 jobs in October, significantly missing expectations. The government said those numbers were weighed down by recent hurricanes and strike activity, most prominently at Boeing (BA).
The report is the last major economic data before the Federal Reserve's next policy decision on Nov. 7. Market expectations for that meeting moved little in its wake, with traders pricing in about 98% odds of a quarter-point rate cut at the Fed meeting next week, per CME FedWatch.
Read more: What the Fed rate cut means for bank accounts, CDs, loans, and credit cards
Meanwhile, upbeat earnings from Amazon helped dissipate the gloom around Big Tech's prospects that drove Thursday's slump in stocks. Its shares jumped over 6% in morning trading after CEO Andy Jassy said its cloud unit's AI business was seeing triple-digit revenue growth.
Morale also got a lift from Intel's (INTC) earnings beat and outlook, which revived hopes for the chipmaker's turnaround and boosted the stock. But Apple (AAPL) shares slipped as its results and outlook left Wall Street wanting more.
Elsewhere in corporates, Boeing shares tipped higher after the union backed its latest offer to end a significant factory workers' strike. The sweetened deal would lift wages by 38%.
Meanwhile, oil prices rose over 2% amid revived Mideast fears, after a report that Iran is planning a strike on Israel via militias that it backs in Iraq. Brent (BZ=F) crude futures traded at around $74 a barrel after briefly nudging $75, while West Texas Intermediate (CL=F) futures were not far off the $71 level.
LIVE 5 updatesA disappointing jobs report solidifies bets on another Fed rate cut
Market predictions on the Federal Reserve cutting interest rates next week reached a near certainty Friday, after the October jobs report showed the US labor market added far fewer jobs than expected.
The report is set to be the last major economic release before the Federal Reserve's next policy decision on Nov. 7. Market expectations for that meeting ticked up slightly after the jobs report. As of Friday morning, markets were pricing in a roughly 99% chance that the Federal Reserve cuts interest rates by 25 basis points next week, up from a 95% chance seen a week ago, according to the the CME FedWatch Tool.
Broadly, recent data outside the monthly employment report has shown a labor market that's gradually cooling, reports Yahoo Finance's Josh Schafer. Data out Tuesday from the Bureau of Labor Statistics showed job openings fell to their lowest level since January 2021 during the month of September.
Following the Fed's move to cut rates by 50 basis points after the central bank's last policy meeting, labor market data has become a crucial metric guiding how much and how fast policymakers should lower rates.
Stocks aim for a comeback after strong Amazon earnings
Wall Street markets were positioned for a turnaround on Friday after a strong showing from Amazon (AMZN) lifted investor sentiment.
The tech-heavy Nasdaq Composite (^IXIC) popped 0.5%, and the S&P 500 (^GSPC) rose 0.4%, both coming off steep losses fueled by after-earnings tumbles in Meta (META) and Microsoft (MSFT). The Dow Jones Industrial Average (^DJI) added 0.4%.
But impressive reports from Amazon and Intel (INTC) set stocks on a comeback trajectory. On Thursday night, Amazon said it expects to make $75 billion in capital expenditures in 2024. CEO Andy Jassy said the company expects to spend "more than that" in 2025, showing investors that heavy AI spending can coincide with profit growth.
Tech stocks in focus: Amazon, Intel, Nvidia rise while Apple sinks
Amazon (AMZN) and Intel (INTC) stocks jumped Friday, lifting Nvidia (NVDA) shares with them.
Amazon stock climbed as much as 7% in premarket as the company proved it can balance hefty AI spending with profit growth. The company’s profit jumped more than 50% to over $17 billion in the third quarter, and its 11% operating margin came in above Wall Street’s expectations of just over 9%. At the same time, CEO Andy Jassy said the company will likely rack up $75 billion in capital expenditure for the full year and spend even more next year.
That’s good news for Nvidia, whose shares rose 1.5% premarket. The AI chipmaker's stock had fallen a day earlier amid fears of moderating AI spending from Big Tech firms. The stock was also helped by positive sentiment on Intel, which itself jumped 7.6% premarket after giving an upbeat fourth quarter outlook. Intel’s guidance lifted chip stocks across the board after a rough few days.
Meanwhile, Apple (AAPL) fell roughly 2% after posting weaker-than-expected China sales, a hit from a hefty EU tax payment, and a soft sales outlook for the current period. Apple projected sales will rise in the low to mid single digits in the December quarter, below than the 7% expected by analysts.
Jobs report: Economy adds 12,000 jobs in big miss, unemployment rate holds steady
The US economy added just 12,000 jobs in October, fewer than the 100,000 economists expected. The unemployment rate held steady at 4.1%.
Recent strike activity, most prominently at Boeing (BA), and weather-related disruptions weighed on the labor market last month, the government said.
Yahoo Finance's Josh Schafer has the details here.
Good morning. Here's what's happening today.
Economic calendar: Nonfarm payrolls (October); unemployment rate, (October); average hourly and Weekly earnings (October); labor force participation rate; S&P Global US manufacturing PMI (October final); ISM manufacturing (October); ISM prices paid (October)
Earnings: Charter Communications (CHTR), Dominion Energy (D), fuboTV (FUBO), Chevron (CVX), Exxon Mobil (XOM), Wayfair (W)
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