Stock futures showed an upward trajectory in response to a somewhat disappointing October jobs report, which reduced bond yields.
The Dow Jones Industrial Average futures increased by 100 points, or 0.3%, daily. The technology-heavy Nasdaq-100 index’s futures saw a 0.3% increase, while S&P 500 futures showed promise.
The October employment data, made public last Friday, showed that the US economy created 150,000 new jobs, less than the 170,000 payroll gain that Dow Jones’ panel of economists had predicted. This figure was also below September’s robust addition of 297,000 jobs.
Furthermore, in contrast to the predicted stability of 3.8%, the unemployment rate rose, rising from 3.8% to 3.9%.
This Friday’s sharp decline in bond yields followed three months of declining stock market prices due to the bleak employment report and a tiny increase in average hourly pay. From its top of 5% the previous month, the yield on the 10-year Treasury note fell by over nine basis points to 4.57%. Similarly, the work on the 2-year Treasury note dropped by seven basis points to 4.9%.
It is essential to remember that yields and bond prices move in different directions and that one basis point is equivalent to 0.01%.
Following the release of a negative revenue outlook by the firm for the December quarter, Apple’s stock experienced a 3% decrease. The company’s overall sales declined for the fourth consecutive quarter in its fiscal fourth quarter while exceeding expectations in revenue and earnings. Conversely, Block’s stock experienced a 16% increase thanks to impressive results and an upward revision in the company’s full-year expectations. Paramount Global’s shares saw a 4.5% increase after a successful quarterly report.
Stocks were expected to post significant weekly gains as of Thursday’s trade closing, as investor confidence about the Federal Reserve’s anticipated end to its rate hikes increased.
The Dow was predicted to increase 4.4%, marking the most robust weekly performance since October 2022. Comparably, the S&P 500 was expected to earn 4.9% per week, while the Nasdaq showed a 5.2% increase, which would be its best weekly return since November 2022.