S&P 500 opens higher as it wraps up banner week with traders seeing bright side of dismal jobs report: Live updates

On Friday, the stock market opened higher as traders viewed a decline in July's jobs report as a positive sign, indicating the Federal Reserve may not need to raise interest rates soon. The S&P 500 climbed 0.4%, while the Nasdaq Composite surged 0.7%, with the Dow Jones Industrial Average gaining 70 points, or 0.1%. Stocks are set to continue their second consecutive week of gains, with the S&P 500 up more than 3% for the week, and the Nasdaq potentially achieving its best weekly performance since April, rising more than 4%.

This performance is largely attributed to a bounce-back in chip stocks, as evidenced by the iShares Semiconductor ETF (SOXX) surging more than 7% this week.

However, the July nonfarm payrolls report revealed a dip of 23,000 jobs, significantly lower than the 83,000 jobs economists had anticipated. The unemployment rate decreased to 4.1%, while the labor force participation rate fell to its lowest level in over five years, at 61.4%. Economists had predicted the rate would stay at 4.2%. Fed funds futures traders now expect the central bank to maintain its benchmark lending rate between 3.50% and 3.75% at the September policy meeting, down from a 55% chance just a day prior.

Market experts believe that the weaker-than-expected job data will not necessitate any immediate rate hikes. Saira Malik, a Nuveen chief investment officer, stated on CNBC's "Squawk Box" that these lower numbers do not support the Federal Reserve's narrative that rate increases are necessary. The software sector led the market upward, with Cloudflare surging 16% following the cloud cybersecurity company's strong full-year and current-quarter outlook.

Atlassian shares rose 34% after its fourth-quarter adjusted earnings and revenue exceeded expectations, and the company provided upbeat guidance. Airbnb also saw a 7% increase after reporting strong top and bottom lines.

Oil prices declined on Friday as investors awaited a potential deal between the U.S. and Iran to reopen the Strait of Hormuz. Treasury Secretary Scott Bessent indicated earlier in the week that a deal could be reached soon. West Texas Intermediate futures for September delivery dropped 0.6%, trading at $76.85 per barrel, while Brent crude slipped 0.7% to $81.90.

After a losing session, Wall Street is set to open on a positive note, following an increase in oil prices that negatively impacted equities.