Equities close higher as softer US jobs data quiets rate-hike expectations
The Dow Jones Industrial Average rose 250.40 points, or 0.49%, to 51,176.96.
On October 2, US stocks surged higher, closing out the trading week as job data revealed a weaker-than-expected labor market. Nonfarm payrolls rose by just 29,000 jobs in September, down sharply from economists' estimates. This dampened expectations of a rate hike from the Federal Reserve, which saw its probability of a 25 basis point increase at its October meeting drop from 24.4% to 22.7%.
SummitTX Capital's Robert Bernstone noted that while the economy wasn't "roaring," the weaker data meant the Fed might not raise rates as quickly as anticipated. The Dow Jones Industrial Average climbed 0.49%, the S&P 500 gained 0.73%, and the Nasdaq Composite surged 1.19%. Rate-sensitive stocks, including the S&P 500 real estate index and the Russell 2000 small-cap index, saw gains of 0.4% and 0.9% respectively.
Mega-cap stocks led the rally, with Nvidia up 1.3% and Tesla gaining 4.7%, significantly boosting the S&P 500's consumer discretionary index by 1.4%. Despite these gains, both the Dow and S&P 500 declined for the week, while the Nasdaq managed a weekly gain. The S&P 500's weekly loss was its fourth in five sessions, but the Nasdaq secured its fifth weekly gain.
Nike was the Dow's worst performer, falling 3.6% after it forecasted a steep decline in annual revenue and announced job cuts.
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