Stocks closed sharply on Friday, with technology shares leading the way up, as investors assessed Friday’s jobs report that showed US hiring rose broadly in September but also that wage growth was slowing.
The Dow Jones Industrial Average surged 288.01 points, or 0.9%, to 33,407.58, the Nasdaq climbed 1.6% and the S&P 500 was up 1.2%.
The S&P 500 rose for the week, snapping a four-week losing streak, while the Dow declined for the third straight week.
Stocks initially fell early after the jobs data, which showed US employment increased by the most in eight months in September but also that wage growth cooled.
“You have an economy that’s moving forward, the Federal Reserve is probably sitting on the sidelines and oil prices are not working against you today. You have a stock market that’s extremely oversold,” said Rober Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Conn.
Financial markets and most economists believe the Fed is probably done hiking interest rates. APAlso, he said, “You have an economy that’s slowing, but not faltering, and you have a Federal Reserve on the sidelines.”
Market watchers have been weighing whether the Fed may be done hiking interest rates after a recent surge in long-term US Treasury yields. Benchmark 10-year U.S. Treasury yields hit 16-year highs on Friday.
Traders put the chance of interest rates remaining unchanged in November and December at around 73% and 58%, respectively, according to CME’s FedWatch tool.
Looking ahead, data would take center stage once again with September consumer price inflation and producer price index readings due next week.
“It’s really going to depend now on next week’s data because the Fed would be happy if inflation comes in modest and we still have the job growth,” said Paul Nolte, senior wealth advisor and market strategist for Murphy & Sylvest Wealth Management.
Focus will also be on the upcoming quarterly earnings season, with major banks including JPMorgan Chase, Wells Fargo, Citigroup and asset manager BlackRock reporting next week.
EV maker Tesla rose 0.2% after cutting prices of its Model 3 and Model Y vehicles in the United States.
Exxon Mobil lost 1.7% after sources told Reuters that the US oil producer was in advanced talks to acquire Pioneer Natural Resources. Pioneer’s stock jumped 10%.
Eli Lilly rose 4.4% after BofA Global Research hiked its price target on the drugmaker’s stock to $700.
