US stocks advanced to record levels on Friday despite a softer-than-expected August jobs report, as investors increased bets on interest rate cuts from the Federal Reserve later this month.
The S&P 500 rose 0.4% to a new high, while the Nasdaq Composite gained 0.7%, also setting a fresh record.
The Dow Jones Industrial Average added 95 points, or 0.2%.
The Bureau of Labour Statistics reported that the economy added 22,000 jobs in August, well below the 75,000 forecast by economists.
The weaker data reinforced expectations of monetary easing.
Fed funds futures indicated a quarter-point reduction in benchmark rates at the September 17 policy meeting, according to CME Group’s FedWatch tool.
Odds of a larger half-point cut also increased following the report, after being considered unlikely just a day earlier.
Equities entered the release near all-time highs, supported by optimism that rate cuts could help stabilise growth.
The S&P 500 is up 1% for the week, while the Nasdaq Composite has gained 1.8% and the Dow 0.4%.
Friday’s move higher was aided by Broadcom, whose shares jumped after the chipmaker posted quarterly results that exceeded Wall Street expectations.
Chief executive Hock Tan also said the company had secured $10 billion in custom AI chip orders from a new client.
US jobs data
US job growth slowed sharply in August, highlighting continued weakness in the labour market and strengthening expectations that the Federal Reserve will cut interest rates later this month.
Nonfarm payrolls increased by 22,000 in August, well below the 75,000 projected by economists surveyed by Dow Jones, the Bureau of Labor Statistics reported Friday.
The unemployment rate rose to 4.3%, in line with forecasts.
The August figure marked a steep decline from July’s revised gain of 79,000.
Revisions also showed payrolls in June fell by 13,000, following an earlier downward adjustment of 27,000.
The data added to evidence of a cooling trend, with job creation slowing, vacancies shrinking, and wage growth moderating in recent months.
Average hourly earnings rose 0.3% in August, meeting expectations. On a year-over-year basis, wages were up 3.7%, slightly short of the 3.8% forecast.
Health care led job gains with 31,000 new positions, followed by social assistance with 16,000.
Offsetting these increases were declines of 12,000 each in wholesale trade and manufacturing, while federal government payrolls contracted by 15,000.
The report was the first since President Donald Trump removed former BLS Commissioner Erika McEntarfer after July’s disappointing results.
Trump has nominated E.J. Antoni, a Heritage Foundation economist, to succeed her, with William Wiatrowski serving as acting commissioner in the interim.
The BLS noted earlier Friday that it was experiencing “technical issues,” though the release went out as scheduled at 8:30 a.m. in Washington.
The weaker data added to signs of slowing economic momentum, reinforcing expectations that the Fed will move ahead with an interest rate cut at its September meeting.
The post US stocks open in the green: Nasdaq, S&P 500 race to new record highs appeared first on Invezz
