In June, the United States added the fewest jobs in two and a half years, but continuing robust wage growth indicated that the labour market was remained tight.
For the majority of the afternoon, the benchmark S&P 500 remained steadily rising, but stocks began to decline as the session came to a close.
According to Quincy Krosby, chief global strategist at LPL Financial, “investors are more cautious going into a very important week with the beginning of earnings season and a very important inflation reading mid-week.”
Following a sell-off on Thursday spurred by a rise in June private payrolls that fuelled concerns the Federal Reserve might act swiftly to raise interest rates to control inflation, a report on Friday indicating a 209,000 gain in nonfarm payrolls was released.
According to Josh Jamner, an investment strategy analyst with ClearBridge Investments, “the jobs report today is consistent with what the Fed would like to see.”
“That doesn’t mean the task has been completed or the purpose accomplished. However, if the job market continues to cool, it will be simpler for them in the long run.
The Nasdaq Composite slid 18.33 points, or 0.13%, to 13,660.72 on Friday, while the S&P 500 lost 12.64 points, or 0.29%, to 4,398.95. The Dow Jones Industrial Average dropped 187.38 points, or 0.55%, to 33,734.88.
Consumer staples lost 1.3%, making defensive categories the worst-performing S&P 500 sector. Materials increased 0.9% while energy increased 2.1%.
The small-cap Russell 2000 finished the day up 1.2%.
After a solid first half of the year, major indexes closed with weekly losses. The S&P 500 declined by around 1.2% for the week, the Dow sank by almost 2%, and the Nasdaq fell by about 0.9%.
Despite pausing in June, the Fed is still generally anticipated to raise rates at its meeting later this month since employment growth is still above that of the decade prior to the pandemic.
Austan Goolsbee, president of the Chicago Federal Reserve, stated that he agrees with his fellow American central bankers that additional rate increases are necessary this year to combat excessive inflation.
In business news, shares of Levi Strauss & Co. fell 7.7% after the manufacturer of denim clothes lowered its annual profit prediction.
After the manufacturer of electric vehicles reported better-than-anticipated quarterly deliveries, the company’s shares increased by 14.2%.
The announcement by Chinese authorities that they will fine Ant Group $984 million put an end to the years-long regulatory revamp by the affiliated fintech company and increased the value of Alibaba’s U.S.-listed shares by 8%.
On the New York Stock Exchange, advancers outnumbered decliners 2.49 to 1; on the Nasdaq, the ratio was 2.00 to 1.
The Nasdaq Composite registered 45 new highs and 63 new lows, while the S&P 500 set 11 new 52-week highs and five new lows.
In contrast to the 11.1 billion daily average over the previous 20 sessions, around 10.3 billion shares were exchanged on U.S. exchanges. (New York’s Lewis Krauskopf and Sinead Carew, Bengaluru’s Bansari Mayur Kamdar and Johann M Cherian, as well as Caroline Valetkevitch for additional reporting; Shinjini Ganguli and Richard Chang for editing.)