Stocks rise after jobs report shows surprise jump in payrolls

Stocks shook off earlier losses to mostly rise Friday afternoon even as investors viewed a much stronger-than-expected jobs report as bolstering the case for the Federal Reserve to continue down its more hawkish monetary policy path.

The S&P 500 turned higher during intraday trading, closing up 0.52% at 4,500.61, while the Dow lost steam to close at 35,089.28. The Nasdaq also rose by 1.58% to 14,098.01. A day earlier, the Nasdaq Composite index sank by 3.7% for its worst single-day decline since September 2020. Oil prices also remained in focus as U.S. West Texas intermediate crude oil prices jumped further above $90 per barrel after crossing that threshold for the first time since 2014 on Thursday.

New labor market data was the major focal point for investors on Friday, showing employment growth held up much more robustly than expected despite the surge in Omicron cases at the beginning of the year. Payrolls grew by 467,000, or well above the 125,000 expected to return, and job gains for December were upwardly revised to more than half a million. The labor force participation rate also improved markedly, and average hourly earnings jumped by a greater-than-expected 5.7%, or the most since May 2020.

The latest jobs report came as a surprise following a string of other softening data points on the state of the labor market, with ADP’s private payrolls report showing earlier this week the first contraction in private-sector employment in more than a year. But Friday’s report offered potential fodder for the hawks in the Federal Reserve to press ahead with their plans to raise interest rates and begin tightening in the near-term, as the economic recovery continues to progress.

“For markets, the jobs report is all about the Fed, and today’s upside surprises in both job creation and wage growth keep the Fed on track to begin raising rates in March and hike four or more times this year,” Barry Gilbert, asset allocation strategist at LPL Financial, wrote in an email Friday.

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Meanwhile, a batch of upbeat quarterly results from Amazon (AMZN), Snap (SNAP) and Pinterest (PINS) helped dispel some of the gloom hanging over technology shares from during the regular trading day, after Meta Platforms (FB) offered an outlook that fell well short of Wall Street’s expectations.

Investors responded favorably to Amazon’s announced price hike on its premium Amazon Prime subscription and better-than-expected growth in its lucrative cloud computing business unit. And Snap and Pinterest each topped Wall Street estimates for quarterly sales and earnings, suggesting Meta Platforms may have been alone among the ad-driven internet companies in bearing the brunt of headwinds from competition and Apple iOS software changes.

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4:01 p.m. ET: Dow loses steam, Nasdaq gains

Here were the main moves in markets as of 4:01 p.m. ET:

• S&P 500 (^GSPC): +23.17 (+0.52%) to 4,500.61

• Dow (^DJI): -22.01 (-0.06%) to 35,089.15

• Nasdaq (^IXIC): +219.19 (+1.58%) to 14,098.01

• Crude (CL=F): +$2.11 (+2.34%) to $92.38 a barrel

• Gold (GC=F): +$3.80 (+0.21%) to $1,807.90 per ounce

• 10-year Treasury (^TNX): +10.3 bps to yield 1.9300%

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12:02 p.m. ET: Bitcoin jumps by nearly 10% to top $40,000

Bitcoin prices (BTC-USD) jumped by nearly 10% Friday afternoon to cross the $40,000 level, with the largest cryptocurrency by market cap posting its biggest single-day rise in months as digital currency prices tracked gains across major tech stocks.

Prices of Ether, LiteCoin, and XRP also moved notably higher during intraday trading as well. Stocks related to cryptocurrencies also gained, including Coinbase (COIN) with a rise of 5%, and MicroStrategy (MSTR) with a jump of more than 11%.

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10:12 a.m. ET: Snap shares surge more than 50% after users, earnings top estimates, shaking off growth concerns

Snap shares (SNAP) soared by more than 50% intraday on Friday after the company topped expectations across virtually all major metrics in its latest quarterly results.

Revenue jumped 42% over last year to reach $1.3 billion, with daily active users growing by 20% to reach 319 million. Adjusted earnings per share of 22 cents were double the 11-cent consensus estimate. The bottom-line results also helped Snap post its first annual profit for the full-year 2021.

Despite the surge in the stock price, however, Snap shares remained lower by more than 20% for the year-to-date through intraday trading on Friday.

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9:40 a.m. ET: Amazon shares jump by most since 2017 after earnings, Prime price increase

Amazon (AMZN) shares rose by 12% just after market open, which would mark the biggest single-day rise in the stock since 2017 after the e-commerce giant posted stronger-than-expected earnings results and announced a price increase on its Prime membership subscription.

Fourth-quarter sales grew 9.4% over last year to a record $137.4 billion. Though online store net sales were down slightly on a year-over-year basis, high-margin Amazon Web Services cloud sales grew 40% to reach $17.8 billion.

Amazon also said its Prime annual membership was going up in price by $20 to $139 each year, offering a future boost to top-line results. The company sees current-quarter net sales coming in between $112 billion and $117 billion, with operating income of as much as $6.0 billion.

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9:30 a.m. ET: Stocks open mixed

Here’s where stocks were trading Friday morning just after market open:

• S&P 500 (^GSPC): +1.13 (+0.03%) to 4,474.86

• Dow (^DJI): -110.52 (-0.31%) to 35,000.64

• Nasdaq (^IXIC): +56.57 (+0.41%) to 13,929.16

• Crude (CL=F): +$1.74 (+1.93%) to $92.01 a barrel

• Gold (GC=F): -$3.70 (-0.21%) to $1,800.40 per ounce

• 10-year Treasury (^TNX): +7.4 bps to yield 1.901%

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8:55 a.m. ET: U.S. employment unexpectedly jumped in January despite Omicron surge

U.S. employers added back far more jobs than expected in January even as Omicron cases surged at the beginning of the new year.

Non-farm payrolls grew by 467,000, far exceeding the 125,000 consensus economists were looking for, according to Bloomberg data. The unemployment rate rose to 4.0%, but this was just a tick above the pandemic-era low of 3.9% seen in December.

Meanwhile, signs of continued inflation also emerged in the January report, as average hourly earnings jumped by a bigger-than-expected 5.7% in January. This came following a 4.7% increase in December. On a month-over-month basis, average hourly wages rose 0.7%, or also well above the 0.5% from December.

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7:32 a.m. ET: Friday: Stock futures mixed ahead of jobs report

Here’s where markets were trading Friday morning:

• S&P 500 futures (ES=F): -5 points (-0.11%), to 4,464.00

• Dow futures (YM=F): -145.00 points (-0.41%), to 34,826.00

• Nasdaq futures (NQ=F): +56.75 points (+0.39%) to 14,549.00

• Crude (CL=F): +$1.90 (+2.10%) to $92.17 a barrel

• Gold (GC=F): +$7.10 (+0.39%) to $1,811.20 per ounce

• 10-year Treasury (^TNX): -0.7 bps to yield 1.82%

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6:13 p.m. ET Thursday: Stock futures jump after Amazon earnings

Here were the main moves in markets during the overnight session:

• S&P 500 futures (ES=F): +45.25 points (+1.01%), to 4,514.25

• Dow futures (YM=F): +148 points (+0.42%), to 35,119.00

• Nasdaq futures (NQ=F): +265.5 points (+1.83%) to 14,757.75

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Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter