Live Stock Market News Updates: Stocks Wobble As Investors Analyze October Payroll Data

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US stocks gave up an early morning rally on Friday as traders took stock of monthly jobs numbers and weighed talk that China could ease COVID restrictions.

The S&P 500 (^GSPC) and the Dow Jones Industrial Average (^DJI) rose about 0.1%, paring the previous session’s strong gains, while the tech-focused Nasdaq Composite (^IXIC) dipped a 0.2%.

The US economy added 261,000 jobs in October, while September’s reading was revised up to 315,000 from 263,000 previously reported, the Labor Department said on Friday. Economists had expected a payroll increase of 195,000 last month, according to consensus estimates compiled by Bloomberg. The unemployment rate rose to 3.7%.

“Today’s stronger-than-expected report illustrates the difficult task still ahead for the Fed as it battles a resilient labor market and persistent inflation,” said Mike Loewengart, head of model portfolio construction at the Bureau of Morgan Stanley Global Investments, in emailed comments. “While the figure may be disappointing for investors expecting a dovish Fed sooner rather than later, keep in mind that it was the lowest reading in nearly two years, so there could be signs the market is slowing.”

Investors have bet that some signs of a cooling labor market would force the Federal Reserve to scale back its aggressive rate-hike campaign, but Chairman Jerome Powell said on Wednesday that slight moderations in the data were not enough to stop the gains. increases. the conditions remain historically strict.

“Although job vacancies have moved below their highs and the pace of job creation has slowed since the beginning of the year, the labor market remains unbalanced, with demand substantially outstripping the supply of available workers,” Powell said. Wednesday after the US central bank delivered a fourth consecutive interest rate increase of 75 basis points.

In the third quarter of this year, payroll earnings averaged 372,000 per month. Weekly jobless claims, the most timely snapshot of the US labor market, have also been consistently low, with this week’s reading at 217,000.

“Initial claims don’t go up one bit,” DataTrek’s Nicholas Colas said in a note. “Simply put, there is still no sign that either the Fed’s aggressive monetary policy or the tighter financial conditions it has brought are hurting US labor markets.”

Central banks around the world have moved in unison with the US Federal Reserve to continue on a combative path of monetary tightening, raising concerns about the impact of synchronized rate hikes. The Bank of England raised interest rates by 75 basis points on Thursday, while European Central Bank President Christine Lagarde said in recent comments that rates may need to be raised to restrictive levels to drag inflation back down. to the 2% target.

While monetary policy has caught investors’ attention this week, corporate profits have continued to rise. Shares of Block (SQ) rose 16% after the company significantly beat estimates on the strong performance of its Cash App and Square payment offerings.

Meanwhile, payment pair PayPal (PYPL) saw shares fall 4% after the company cut its revenue forecast to 8.5% from its previous outlook of 18%, even as it outperformed earnings results.

Shares of Twilio (TWLO) plunged 34% after the cloud communications company missed earnings and reported softer-than-expected guidance.

Shares of Toymaker Funko (FNKO) plunged 50% after the company reported a huge profit loss and lowered its annual forecast ahead of the holiday season.

Meanwhile, shares of Alibaba (BABA) rose 6% along with a rally in Chinese stocks amid speculation the country will halt its strict zero COVID policy.

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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