Stocks soared on Friday as investors reacted positively to big-tech earnings results and a crucial jobs report, reinforcing expectations that the Federal Reserve may continue reducing interest rates.
The S&P 500 climbed by 1%, with the Dow Jones Industrial Average and Nasdaq Composite showing gains of 1.2% and 1.3%, respectively.
This rally followed Thursday’s steep drop, where significant tech stock declines pulled indexes into a monthly loss for October, marking the end of multi-month gains for both the Dow and S&P 500.
The job market report, released Friday, revealed a smaller-than-anticipated increase in employment, although the unemployment rate stayed consistent at 4.1%.
This data is drawing heightened attention from the Fed, as they have voiced concern about a potential slowdown in the labor market. The Fed’s next decision on interest rates, set to be announced on Thursday, remains in sharp focus as economists assess whether the report will justify continued rate cuts.
The yields on 10-year Treasury bonds dipped to 4.33% after initially dropping as low as 4.22% following the job data release.
These movements reflect growing optimism that the Fed might adopt a more cautious approach toward rate hikes.
In recent weeks, bond yields have fluctuated as investors recalibrate their expectations for Fed rate policy, adding an extra layer of complexity to market forecasts.
Amazon, Nvidia, and other tech heavyweights led the stock market’s recovery on Friday, with Amazon rising nearly 7% after posting stronger-than-expected earnings from its cloud and advertising sectors.
Nvidia also saw a nearly 3% boost, continuing its strong 2024 performance. Intel gained 5% after surpassing Wall Street’s revenue forecasts, while Microsoft and Meta bounced back after losses on Thursday.
However, Apple was an outlier, dropping 1.5% after reporting earnings that missed projections.
Outside of tech, Boeing’s stock rose more than 3% after the aerospace giant reached a preliminary labor agreement with its machinists union, potentially ending a seven-week strike.
ExxonMobil and Chevron also showed gains after revealing their quarterly earnings.
Boeing’s shares have struggled this year, making this positive labor development a hopeful sign for investors as the company navigates through financial challenges.
Gold prices held steady around $2,760 an ounce after reaching record highs earlier in the week, and Bitcoin also rallied to $71,100.
These alternative assets continue to draw interest, particularly amid the fluctuating stock and bond markets, as investors look for ways to diversify their portfolios amid market uncertainty.
The recent stock gains reflect a renewed optimism in major tech and industrial sectors despite recent setbacks, while economic indicators like the job market are closely monitored. As investors and analysts eagerly await the Fed’s rate decision, the stock market appears to be finding stability, albeit with cautious optimism.
Written with the assistance of artificial intelligence.