Stocks end mixed Friday, with the S&P 500 closing at a record high, following better than expected November jobs data.
The S&P 500 gained 0.25% to finish the session at 6,090.27, while the tech-heavy Nasdaq rose 0.81% to close at 19,859.77. The Dow Jones Industrial Average gave up 123.19 points, or 0.28%, to end the day at 44,642.52.
The S&P 500 and Nasdaq went on to their third straight positive week as well, rising 0.96% and 3.34%, respectively, according to CNBC. The Dow slipped 0.6% during the period.
Bill Adams, chief economist for Comerica Bank, said the November jobs report affirms that October’s weakness was due to one-off factors.
“Job growth rebounded in November as the economy recovered from Hurricanes Milton and Irene and the Boeing strike ended,” he said. “Looking through the distortions of those one-off shocks, the three-month average of job growth is a moderate 173,000."
"Even so, there’s a meaningfully larger margin of slack in the job market than a year and a half ago." he added.
Adams said the November jobs report has ambiguous implications for monetary policy.
"One the one hand, there’s clearly more slack in the job market than a year or two ago—that argues for more rate cuts," he said. "On the other hand, wage growth continues to run faster than in the pre-pandemic period, which could sustain inflationary pressures in labor-intensive industries—that argues against them."
Weighing the risks in both directions, Adams said the Fed is more likely than not to cut the federal funds target another quarter percent at the December decision, since they are confident that interest rates are currently restrictive and they want rates to be less of an obstacle for the economy in 2025.
"However, they will likely slow the pace of rate cuts in 2025," he said. "After the December decision, the Fed is likely to switch to a quarterly pace of cuts, with subsequent cuts in March and June."
Updated at 12:22 PM EST
UnitedHealth slides
Stocks are holding gains into the afternoon session, with the S&P 500 up 10 points, or 0.16%, and the Nasdaq rising 120 points, or 0.61%
UnitedHealth's slump pulled the Dow around 102 points lower while the Russell 2000 added 10 points, or 0.43%
1. Stocks: all-time highs
— Charlie Bilello (@charliebilello) December 6, 2024
2. Home Prices: all-time highs
3. Bitcoin: all-time highs
4. National Debt: all-time highs
5. Core CPI Inflation: >3% for 42 straight months, longest run of high inflation since early 1990s
6. Fed: cutting rates again in 2 weekshttps://t.co/rQuXrxVpWs
Updated at 11:32 AM EST
UnitedHealth slides
UnitedHealth Group (UNH) shares extended their two-day decline in late-morning trading, falling to the lowest level since July, following the murder of UnitedHealthcare CEO Brian Thompson earlier this week in Manhattan.
Thompson, 50, was shot and killed near a Hilton hotel that was hosting the health insurance giant's annual investor event Wednesday. The shooter remains at large and police are offering a $10,000 reward for information that leads to his arrest.
UnitedHealth Group shares were last marked 5.6% lower at $545.55 each, a move that trims the stock's six-month gain to around 8.9%.
🚨UPDATE: Below are photos of a person of interest wanted for questioning regarding the Midtown Manhattan homicide on Dec. 4. This does not appear to be a random act of violence; all indications are that it was a premediated, targeted attack.
— NYPD NEWS (@NYPDnews) December 5, 2024
The full investigative efforts of… pic.twitter.com/K3kzC4IbtS
Updated at 10:28 AM EST
Time for TikTok?
China's ByteDance faces a ban on its U.S. operations of the social media group TikTok after a federal appeals court refused to dismiss a case brought last by the the Justice Department of President Joe Biden.
The court said ByteDance has until January 19 to either sell or divest the U.S. business or face a total ban. The company is expected to appeal the ruling to the U.S. Supreme Court.
TikTok’s Chinese parent company faces a ban in the US if it doesn’t meet a Jan. 19 deadline to sell the video-sharing app as a result of a federal appeals court ruling https://t.co/vfoi81M4J1
— Bloomberg (@business) December 6, 2024
Updated at 9:36 AM EST
Green Open
Stocks bumped higher following the solid November jobs data that suggests a stronger case for a 'soft landing' that will allow for at least one more Fed rate cut.
"The economy continues to produce a healthy amount of job and income gains, but a further increase in the unemployment rate tempers some of the shine in the labor market and gives the Fed what it needs to cut rates in December," said Ellen Zentner, chief economic strategist for Morgan Stanley Wealth Management.
The S&P 500 was marked 16 points, or 0.27% higher in the opening minutes of trading, with the Nasdaq up 62 points, or 0.31%.
The Dow gained 102 points while the mid-cap Russell 2000 rose 16 points, or 0.66%.
S&P 500 Opening Bell Heatmap (Dec 06, 2024)$SPY +0.18%🟩$QQQ +0.17%🟩$DJI +0.32%🟩$IWM +0.74%🟩 pic.twitter.com/iQaTXMpAqG
— Wall St Engine (@wallstengine) December 6, 2024
Updated at 8:46 AM EST
Jobs rebound
The U.S. economy added a larger-than-expected total of 227,000 new hires last month with upward revisions to the September and October tallies that suggest solid job market momentum into the end of the year.
Average hourly earnings in November rose 0.4% from prior-month levels and were up 4% on an annual basis, with both tallies topping Wall Street forecasts.
The headline unemployment rate, however, edged higher to 4.2%, while the labor force participation rate slipped modestly to 62.5%.
U.S. stock futures added to gains following the data release, with the S&P 500 now called 7 points higher and the Nasdaq priced for a 36 point advance and the Dow for a 35 point gain.
Benchmark 10-year Treasury note yields fell 3 basis points to 4.159% following the data release while rate-sensitive 2-year notes fell 6 basis points to 4.112%.
The three-month moving average of US private-sector job growth ticked up to 138,000 in November, the highest since May pic.twitter.com/nWVOCHvDwI
— Nick Timiraos (@NickTimiraos) December 6, 2024
Stock Market Today
Stocks drifted lower on Thursday, with a big decline for UnitedHealth Group (UNH) dragging the Dow Jones Industrial Average 250 points into the red as markets pulled back from the December record run heading into today's November jobs report.
Economists expect the report, due at 8:30 a.m. U.S. Eastern Time, to show a big rebound from October's hurricane and strike-affected 12,000 tally, the lowest in four years, with a headline gain of around 202,000 new hires.
Wage pressures, however, are likely to have eased as other job market readings show that Americans are finding it harder to secure higher-paying position as companies keep new hiring to a minimum into year-end.
A hotter-than-expected reading in wages or job gains could stoke concerns for renewed inflation pressures and pare bets on a December Fed rate cut. A softer report would add fuel to the market's forecast for an end-of-year cut and further reductions into the second half of next year.
The CME Group's FedWatch tool pegs the odds of a quarter-point rate cut later this month in Washington at around 68.5%.
On Wall Street, stocks are set for a muted open heading into the jobs report, with futures contracts tied to the S&P 500 indicating a 5-point opening bell decline and those linked to the Dow suggest a 20-point dip.
The tech-focused Nasdaq is called 6 points lower in very light premarket volume.
Related: Wall Street analysts race to reprice S&P 500 targets as bull market roars on
Oil prices were also trading lower following a decision by the OPEC cartel, as well as nonmember allies such as Russia, to delay reducing their coordinated output cuts until April, suggesting ongoing concern for global demand.
Brent crude futures contracts for February delivery, the world's pricing benchmark, fell 54 cents to $71.55 per barrel while WTI contracts for January, which are tightly linked to U.S. gasoline prices, fell 51 cents to $67.79 per barrel.
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In Europe, the regional Stoxx 600 benchmark edged 0.3% higher in midday Frankfurt trading, while Britain's FTSE 100 was little changed from last night's close in London.
Overnight in Asia, the regionwide MSCI ex-Japan index rose 0.22% into the close of trading, while Japan's Nikkei 225 ended the week 0.77% lower in Tokyo.
Related: Veteran fund manager delivers alarming S&P 500 forecast
