Stock ended sharply lower and Treasury yields were rising Friday as investors reacted to September's jobs report and Wall Street's slump extended to a third day.
The Dow Jones Industrial Average finished down 630 points, or 2.11%, to 29,296, while the S&P 500 sank 2.80%, and the tech-heavy Nasdaq lost 3.80%.
The benchmark 10-year Treasury yield was up at 3.888%, while the yield on the policy sensitive 2-year Treasury was up at 4.316%. Bond yields and prices move inversely.
Nonfarm payrolls increased 263,000 for the month, the U.S. Department of Labor reported, compared with economists' expectations for 275,000. The unemployment rate was 3.5%, compared with analysts' forecast of 3.7%.
Friday’s payrolls report is the last before the Federal Reserve makes its next decision on interest rates, scheduled for Nov. 2.
"Despite the loss of over a million job openings in August, a lot of strength remains in the labor market given how low jobless claims is trending," said Edward Moya, senior market analyst for the Americas with Oanda. "Even if we see some pricing relief, a strong jobs market will allow the Fed to lean towards the hawkish side."
Charlie Ripley, senior investment strategist for Allianz Investment Management, said "today's employment data did little to change the narrative for a Fed committee that has been intensely focused to bring down inflation."
"The robustness of the post-pandemic labor market conditions continues to be a problem for the Fed as the current policy measures put in place have yet to bring a meaningful slowdown to the economy," he said. "With payrolls still coming in well above 200k per month, wage gains still elevated, the Fed will have to remain aggressive in the near term and another 75 basis point hike in November appears to be in the cards."
Stocks finished lower Thursday as Wall Street went from a two-day rally to a two-day slump. The Dow Jones Industrial Average finished down 347 points, or 1.15%, to 29,926, while the S&P 500 lost 1.03% and the tech-heavy Nasdaq slipped 0.68%.
Stocks had ticked briefly higher late Wednesday before ending the session in the red and halting a two-day winning streak that marked the start of the quarter.
Oil prices were climbing after OPEC+, which includes Russia, on Wednesday agreed to cut oil production by 2 million barrels of oil a day, or 2% of global production.
The price of Brent crude was up 3.60% to $97.82 a barrel, while WTI Crude was up 4.57% to $92.49.
In response OPEC+'s move, the Biden Administration said it will release 10 million barrels of oil from the U.S. Strategic Petroleum Reserve.
Quincy Krosby, chief global strategist for LPL Financial, said “keeping gasoline prices down across the country is a major political imperative just weeks away from the mid-term elections.”
“With mid-term elections just weeks away, and with analysts coming out with their baskets of sectors and stocks to watch based on projected outcomes of which party takes the House and Senate, oil prices could play a decisive role in which party captures votes,” Krosby said. “Voters historically watch prices at the pump before elections, and tend to punish the party in power that makes driving more expensive.”
Chip stocks were under pressure Friday after Advanced Micro Devices (AMD) warned its third-quarter revenue would be lower than anticipated. Nvidia (NVDA) finished down 8%, while Intel (INTC) fell 5.4%.
Shares of cannabis companies Canopy Growth (CGC) and Tilray Brands (TLRY) ended significantly lower, a sharp turnaround from Thursday's higher close after President Biden announced that he will pardon thousands of people convicted of marijuana possession.
Credit Suisse (CSGKF) stock finished up 13.1% after the Swiss bank said it plans to buy back up to $3 billion in debt.
Credit Suisse stock and bond prices fell in recent weeks amid expectations the bank would raise new shares to fund its restructuring. An online frenzy also sparked concerns about the bank's financial health.
Among other stocks, shares of DraftKings (DKNG) ended up 3.3% on news that the online betting company may be looking to cut a deal with Disney's (DIS) ESPN network.
Levi Strauss (LEVI) shares finished down 11.7% after the jeans-maker lowered its full year forecast, citing the strong dollar and supply chain disruptions.
CVS Health (CVS) ended down 10.5% % after the company said its largest health insurance plan for Medicare recipients received a lower performance rating from the Federal government program.
