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U.S. stocks finished higher on Friday, October 2, as a weaker-than-expected jobs report eased fears that economic strength could add to inflation and prompt another Federal Reserve rate increase. The Dow Jones Industrial Average rose 250.40 points, or 0.49%, to 51,176.96, while the S&P 500 gained 0.73% and the Nasdaq Composite advanced 1.19%.
The rally followed government data showing that employers added 29,000 jobs in September, a sharp slowdown from August’s revised 133,000 gain. The figures helped shift investor focus toward the possibility that the Fed may hold rates steady at its October meeting, though bond-market volatility and elevated oil prices limited the day’s advance.
Jobs data shifts rate expectations
The Bureau of Labor Statistics reported that U.S. nonfarm payroll employment increased by 29,000 in September, while the unemployment rate edged up to 4.2% from 4.1%. The report was published Friday morning, before the regular U.S. stock-market session.
The employment figures came in below economists’ expectations. The Associated Press reported that traders reduced their bets on an October rate increase after the release; market pricing cited by AP put the perceived probability below 23%, down from 64% a week earlier.
That reaction reflected the competing implications of the data. A softer labor market can reduce pressure on wages and demand, potentially helping contain inflation, but it also signals slower momentum in hiring. Investors responded positively on the day, without the report resolving how policymakers will balance employment and price stability.
Indexes close higher, but gains retreat
The Dow added 250.40 points to close at 51,176.96. The S&P 500 gained 56.27 points to 7,722.72, while the Nasdaq rose 319.27 points to 27,190.86. The Russell 2000, which tracks smaller companies, advanced 0.9% to 2,832.90.
The broader S&P 500 ended within 1% of its record high, according to AP. However, it had risen as much as 1.2% earlier in the session before surrendering part of its gains as Treasury yields recovered from their initial decline.
The close offered a mixed picture over longer periods. Despite Friday’s rebound, the Dow was down 1.3% for the week and the S&P 500 had lost 0.3%; the Nasdaq was up 0.5% for the week. All three indexes remained higher for the year, with the Nasdaq leading the major benchmarks through October 2.
Treasury yields and oil remain in focus
The 10-year Treasury yield briefly fell below 5.17% after the jobs release, retreating from a high near 5.35% on Thursday. It later rebounded to 5.28% as oil prices recovered, according to AP. Higher yields can raise borrowing costs and reduce the relative appeal of equities, so the bond-market swing helped restrain stocks’ early gains.
Oil traded unevenly amid uncertainty over how the war with Iran could affect global supply. Brent crude moved between $98 and $103 a barrel on Friday and settled at $102.25, down 0.1%, AP reported. The recovery in oil prices accompanied the reversal in Treasury yields during the session.
Company moves diverge
Among individual stocks, Tesla gained 4.7% after reporting quarterly deliveries of 486,532 vehicles, above analysts’ expectations, AP said. Nvidia rose 1.3% and was the largest single contributor to the S&P 500’s advance, reflecting the influence of the large technology company on the market-capitalization-weighted index.
Nike moved in the opposite direction, falling 3.6%. The company reported quarterly profit stronger than analysts had expected, but revenue weakened more than anticipated and its outlook for fiscal-year profit fell short of forecasts, according to AP.
What comes next
The jobs report was the main scheduled catalyst for Friday’s trading, and the next employment release is due November 6, when the BLS is scheduled to publish data for October. Until then, investors will have other economic and company information to assess, while the October Federal Reserve meeting remains a near-term focus for interest-rate expectations.
Friday’s advance does not establish that the Fed will leave rates unchanged, nor does a single monthly jobs estimate settle the direction of the labor market. The day’s closing figures show how investors interpreted the release at that moment: stocks rose, while yields and oil prices continued to signal uncertainty about inflation and the economic outlook.
