US close: Stocks higher despite weaker-than-expected jobs report

dl usa house american housing united states residential generic 2 unsplash — Sharecast / Andy Feliciotti via Unsplash

US stocks closed higher on Friday following the release of a weaker-than-expected non-farm payrolls report for last month.

At the close, the Dow Jones Industrials was up 0.66% at 34,061.32, while the S&P 500 advanced 0.94% to 4,358.34 and the Nasdaq Composite saw out the session 1.28% firmer at 13,478.28.

The Dow advanced 222.24 points on Friday despite the Department of Labor revealing that hiring had slowed to a pace of 150,000 in October, short of consensus estimates for a reading of 170,000. Average hourly earnings growth also came in below forecasts at 0.2% month-on-month (consensus: 0.3%), while readings for the prior two months were revised down by a combined 101,000.

"The October jobs report provides plenty of evidence that labor market conditions are softening and will allow the Fed to keep policy on hold as it monitors its progress toward returning inflation to 2%," said Nancy Vanden Houten at Oxford Economics.

US equity markets had rallied since the start of the week – with Wall Street's three major equity indices surging between 3.2% and 4.7% – on rising hopes that the Federal Reserve's current rate-hiking cycle might be over.

"The fact markets across the US, Europe and Asia remained in an up-trend suggests investors are gaining confidence that we’ve finally reached the much-anticipated pivot in central bank policy,” chipped in AJ Bell investment director Russ Mould.

Turning to Treasuries, the yield on the benchmark 10-year note had slipped 14 basis points to 4.519%, while its two-year counterpart was down ten basis points at 4.870%.

In the corporate space, Apple shares were 0.52% lower after fourth-quarter revenues were down 1% at $89.5bn. The tech giant did surpass analysts' estimates with its results – which included a record $43.8bn in quarterly iPhone revenues – but disappointed with its outlook for hardware and China sales.

"Once again, we have a tech stock managing to beat on both top and bottom-line growth, but markets continue to take somewhat unforgiving stance, opting to instead focus on weak iPad, wearables and Greater China revenue. Nonetheless, shareholders should remain optimistic given the strong figures across their key iPhone and services segments," said Joshua Mahony, chief market analyst at Scope Markets.

Reporting by Iain Gilbert at Sharecast.com

Dow Jones - Risers

Goldman Sachs Group Inc. (GS) $327.62 4.42%
Walgreens Boots Alliance, Inc. (WBA) $22.11 2.84%
Walt Disney Co. (DIS) $85.07 2.14%
Nike Inc. (NKE) $107.06 1.88%
3M Co. (MMM) $93.86 1.68%
Boeing Co. (BA) $195.05 1.58%
Dow Chemical Co. (DOW) $49.73 1.51%
Microsoft Corp. (MSFT) $352.80 1.29%
American Express Co. (AXP) $152.76 1.27%
Amgen Inc. (AMGN) $269.86 1.23%