Stocks Rise as Jobs Report Eases Fed-Hike Worries: Markets Wrap
(Bloomberg) — A slowdown in the US jobs market drove stocks higher on speculation the Federal Reserve won’t be forced to lift rates any time soon.
Those bets fueled the appetite for riskier corners of the market, with the S&P 500 paring this week’s loss. The Nasdaq 100 rose 1%. While bonds erased earlier gains, money markets see lower chances of a Fed hike in October. A drop in fuel prices also helped sentiment as the Group of Seven nations signaled they would release emergency supplies of diesel and crude.
The US added fewer jobs than expected in September and wage growth slowed, signaling some caution among employers amid rising costs.
Nonfarm payrolls increased 29,000 last month after a downward revision to the prior two months. That missed all estimates in a Bloomberg survey of economists. The unemployment rate rose to 4.2%, partly reflecting a growing workforce.
“A softer-than-expected jobs report should put an October Fed hike firmly on the back foot,” said Seema Shah at Principal Asset Management. “Weaker payrolls, softer wage growth and a higher unemployment rate all point to a labor market that’s cooling rather than reaccelerating.”
The September jobs report provides additional weight to the case for a patient Fed rather than one that needs to move forward more aggressively with a series of hikes to achieve its dual mandate, according to Jim Baird at Plante Moran Financial Advisors.
Friday’s data may revive the “bad news is good news” narrative, but hoping for a weaker labor market to secure easier financial conditions is a poor tradeoff, according to Bret Kenwell at eToro. Inflation remains a problem, but a breakdown in jobs would create an entirely different one, he noted.
Going forward, a 5% yield on the 10-year Treasury is the level to watch, Kenwell said. “If that becomes the new floor, it could challenge the idea that markets can continue to absorb higher rates without consequences,” he added.
At Edward Jones, Angelo Kourkafas said the latest jobs data pointed to a labor market that’s cooling, but remains fundamentally healthy and is not showing signs of generating significant inflationary pressures.
“While higher rates and geopolitical uncertainty may continue to weigh on valuations and contribute to periods of volatility, a still-expanding economy and robust earnings growth should help provide a solid foundation for stocks through the remainder of the year,” he added.
Corporate Highlights:
Tesla Inc. reported better-than-expected sales for the third quarter, a sign of stability for the company’s core business at a challenging moment for the electric vehicle market. Broadcom Inc.’s Wall Street syndicate is starting to gather $60 billion of fresh AI chip financing to benefit Anthropic PBC and other companies, according to people with knowledge of the matter. Amazon.com Inc. is exploring a deal to shift about $8 billion worth of top-end Nvidia Corp. chips off its balance sheet, according to the Financial Times. Western Digital Corp. and Seagate Technology Holdings Plc sank after Nikkei reported that Toshiba would invest about 60 billion yen to double its production capacity for hard disk drives. Nike Inc. is cutting jobs and embarking on a sweeping overhaul of the business as results deteriorate and test Wall Street’s patience with Chief Executive Officer Elliott Hill. Some of the main moves in markets:
Stocks
The S&P 500 rose 0.7% as of 2:07 p.m. New York time The Nasdaq 100 rose 1% The Dow Jones Industrial Average rose 0.5% The MSCI World Index rose 0.6% Currencies
The Bloomberg Dollar Spot Index fell 0.2% The euro was little changed at $1.1255 The British pound rose 0.3% to $1.3237 The Japanese yen rose 0.2% to 157.81 per dollar Cryptocurrencies
Bitcoin rose 0.2% to $84,771.26 Ether fell 0.5% to $2,683.98 Bonds
The yield on 10-year Treasuries advanced four basis points to 5.28% Germany’s 10-year yield declined five basis points to 3.46% Britain’s 10-year yield declined three basis points to 5.37% Commodities
West Texas Intermediate crude fell 1.5% to $91.50 a barrel Spot gold fell 1% to $4,136.90 an ounce ©2026 Bloomberg L.P.
