U.S. stock futures rose Friday morning as investors digested the Labor Department’s closely watched April jobs report, which showed the US labor market remains strong with more than 250,000 jobs added to the economy last month.
The economic data caps off a busy week for investors, which saw the Federal Reserve once again raise interest rates by another 0.25% as key earnings from companies like Apple (AAPL), Starbucks, (SBUX) and Ford (F) came in mostly positive for the quarter.
Futures tied to the S&P 500 (^GSPC) rose 0.72%, while futures on the Dow Jones Industrial Average (^DJI) added 184 points, or 0.45%. The technology-heavy Nasdaq Composite (^IXIC) was up 0.66% before the bell.
The flight to traditional “safe haven” assets like gold (GC=F) eased slightly on Friday following heightened upheaval within the regional banking sector — about two months since the stunning collapse of Silicon Valley Bank, which trigged a ripple effect across the entire financial system.
On Thursday, regional bank stocks including PacWest Bancorp (PACW), Western Alliance Bancorporation (WAL), and Zions (ZION) all saw double-digit declines amid reports PacWest was seeking strategic options, including a potential sale or capital raise. That, coupled with the seizure of First Republic by JPMorgan Chase (JPM) still fresh in the minds of investors, contributed to heavy losses within the sector.
However, those pressured stock moves reversed during Friday’s early morning trading session, with PacWest, Western Alliance, and Zions seeing premarket gains of about 18%, 12%, and 8%, respectively.
Gold prices were relatively flat, but still traded near record highs at $2,046.00 an ounce.
WTI crude oil (CL=F) and Brent crude (BZ=F), which saw prices tumble in the wake of the Fed decision and other cost pressures like a rise in U.S. gasoline inventories, gained to trade around $70.38 and $74.29 a barrel, respectively.
Investors continue to digest the Federal Reserve’s rate hike decision earlier this week as Fed Chair Jerome Powell did little to calm market jitters after he left the door open for more rate increases down the line.
“A decision on a pause was not made today,” Powell said during Wednesday’s press conference, although he did note, “There’s a sense that we’re … much closer to the end of this than the beginning.”
Friday’s jobs report, particularly surrounding the strong pace of wage growth, will be a key factor when it comes to future Fed rate policy.
Nonfarm payrolls rose by 253,000 in April with the unemployment rate falling to 3.4%. Average hourly earnings also topped expections, rising +4.4% year-on-year versus the expected +4.2%.
Economists surveyed by Bloomberg expected the U.S. economy to have added 185,000 nonfarm payroll jobs last month with the unemployment rate ticking marginally higher to 3.6%. To compare, the U.S. economy added 236,000 jobs in March while the unemployment rate fell to 3.5%.
Friday’s jobs data comes after weekly initial jobless claims surpassed expectations. According to the report, released on Thursday, 242,000 jobless claims were filed, an increase of 13,000 from the previous week’s revised level.
Friday morning’s top trending stocks
Apple (APPL), a top trending ticker on Yahoo Finance, saw shares rise more than 2% on Friday after the company reported quarterly earnings that beat estimates on better-than-expected iPhone sales.
Block (SQ) jumped another 3% after beating earnings on both the top and bottom lines. The company also boosted its full-year outlook as its popular Cash App payments platform continues to drive growth.
Shopify (SHOP) traded relatively flat in premarket trading, after climbing nearly 24% on Thursday. The e-commerce company announced a massive strategic shift, revealing it will sell its logistics business and lay off 20% of its workforce.
Carvana (CVNA) surged roughly 45% early Friday after losses narrowed and revenue topped estimates. The online used car retailer has been on a massive cost cutting campaign after a terrible 2022 for investors.
DraftKings (DKNG) rose more than 11% in premarket trading on Friday following strong earnings. The company raised its 2023 revenue guidance, now expecting full-year revenue to easily surpass $3 billion for the first time.
Lyft (LYFT) sank another 15% after reporting disappointing second-quarter guidance. It was the first earnings report since David Risher took over the CEO position from founder Logan Green in April.
Paramount Global (PARA) bounced back slightly from its massive sell-off, rising just about 1%, after closing Thursday’s session down a whopping 28%. The company, which missed earnings expectations on both the top and bottom lines, continues to battle advertising headwinds and greater losses within its streaming division. The media giant also updated its dividend policy, cutting its quarterly cash dividend to $0.05 per share from $0.24 a share.
Similarly, Warner Bros. Discovery (WBD), which reported earnings before the bell on Friday, sank 4% after earnings missed estimates. The media giant reversed streaming losses, saying it now expects its U.S. direct-to-consumer business to be profitable this year.
Alexandra Canal is a Senior Reporter at Yahoo Finance. Follow her on Twitter @alliecanal8193 and email her at [email protected]
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Source: https://finance.yahoo.com/news/stock-market-news-live-updates-may-5-2023-114123916.html