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US stocks mostly rose on Friday as investors digested the last monthly jobs report of the year, a crucial test of the prospects for interest rate cuts in December and beyond.
The Dow Jones Industrial Average (^DJI) lost about 0.2%, while the S&P 500 (^GSPC) rose 0.2%. Meanwhile, the tech-heavy Nasdaq Composite (^IXIC) increased roughly 0.6% as Amazon (AMZN), Apple (AAPL), and Meta (META) gained, tapping all-time intraday highs.
The US economy added 227,000 jobs in November, slightly more than expected, as the labor market rebounded from October data that was dinged by severe weather and labor strikes. The unemployment rate unexpectedly ticked up to 4.2%. Yahoo Finance’s Josh Schafer has all the details here.
The report largely matched hopes for a “Goldilocks” reading — strong enough to dampen concerns about the economy but soft enough to keep the Fed’s options open on lowering rates this month and into next year.
On Friday, markets were pricing in near-90% odds the Fed lowers rates by a quarter percentage point on Dec. 18, per the CME FedWatch Tool, compared with about 70% before the report.
Meanwhile, the rally in bitcoin (BTC-USD) continued to flag, with the cryptocurrency slipping to trade around $99,000. Options show some investors are hedging against a deeper pullback after the leading token’s record-breaking surge to over $100,000 for the first time.
The rally has been spurred by hopes of support for digital currencies from President-elect Donald Trump, who on Thursday named former PayPal (PYPL) COO David Sacks as his “White House AI & Crypto Czar.”
On the corporate front, shares of Lululemon (LULU) and Ulta Beauty (ULTA) jumped in after the retailers both boosted profit forecasts.
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Bitcoin moves back up above $101,000
Bitcoin (BTC-USD) shot up above $101,000 at around 1:10 p.m ET on Friday after falling below the $100,000 milestone level.
On Thursday evening President-elect Donald Trump announced venture capitalist David Sacks will be his incoming administration’s “AI and Crypto Czar.”
Bitcoin reached new highs late Wednesday as it surpassed $100,000 for the first time following Trump’s nomination of Paul Atkins to chair the Securities and Exchange Commission. Atkins is seen as a crypto-friendly pick for the position.
The token cleared $103,000 after Trump took to his social media platform Truth Social early Thursday to cheer the recent all-time highs, telling crypto enthusiasts that they are welcome for the rally that has followed his election win last month.
“CONGRATULATIONS BITCOINERS!!! $100,000!!! YOU’RE WELCOME!!!” Trump wrote. “Together, we will Make America Great Again!”
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Nasdaq pops in afternoon trading
A jobs report that largely matched hopes for a “Goldilocks” reading sent stocks higher in afternoon trading Friday, as investors digested a crucial test of the prospects for interest rate cuts in December and beyond.
Several big tech names also hit intraday highs, including Amazon (AMZN), Apple (AAPL), and Meta (META).
The Dow Jones Industrial Average (^DJI) was the outlier among the major indexes, shedding about 0.1%. But the S&P 500 (^GSPC) rose 0.2% and the tech-heavy Nasdaq Composite (^IXIC) increased roughly 0.6%.
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US appeals court reinforces TikTok ban
A US federal appeals court upheld a new law that outlaws TikTok from operating in the US under Chinese ownership, reports Yahoo Finance’s Alexis Keenan.
The plan could still be altered by the Supreme Court or affected by President-elect Donald Trump, who in September suggested in a social media post that he would “save TikTok” and prevent federal law enforcement from shuttering the app.
The law, called the Protecting Americans from Foreign Adversary Controlled Applications Act (PAFACAA), gives TikTok’s Chinese owner, ByteDance, an ultimatum to either sell TikTok to a US owner by Jan. 19, 2025, or have it banned from operations in the country.
TikTok challenged the law by arguing it violated the US Constitution in taking away the First Amendment rights of TikTok’s US entity and its users.
But a panel of three judges from the US Court of Appeals for the District of Columbia Circuit concluded that the government’s law withstood constitutional scrutiny by protecting free speech in the US “from a foreign adversary nation and to limit that adversary’s ability to gather data on people in the United States.”
Read about the latest on the government’s effort to ban TikTok under Chinese ownership here.
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Jobs rebound ‘doesn’t change the narrative’ for Fed rate cut this month
A labor market rebound announced Friday is likely to keep the Federal Reserve on track to cut interest rates by another quarter percentage point later this month, absent any upside surprises to inflation, reports Yahoo Finance’s Jennifer Schonberger.
“For the Fed, this doesn’t change the narrative,” Robert Sockin, Citigroup’s senior chief economist, told Yahoo Finance.
The new jobs numbers are “right in the spot of what they were looking for and they are comfortable with to continue easing policy” at the last meeting of the year, on Dec. 17-18.
Traders boosted the odds of a rate cut at that meeting to 91% following the data release.
But Fed watchers agreed that the robust jobs picture and recent stickiness in inflation reinforce a mounting conviction that the pace of rate cuts in 2025 will be less aggressive than once expected.
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One-year inflation expectations hit highest level in six months
Consumers are growing more concerned about the path forward for inflation over the next year.
The latest consumer sentiment survey from the University of Michigan revealed that consumers expect inflation to hit 2.9% in a year, an increase from last month’s expectation of 2.6%. December’s reading is the highest in six months but within the 2.3% to 3% range seen in the two years before the pandemic.
Expectations for long-run inflation slipped higher, though, falling to 3.1% from 3.2% the month prior.
The overall consumer sentiment index popped to a reading of 74, up from 71.8 in November.
Overall, consumer views on inflation varied based on political party, Surveys of Consumers Director Joanne Hsu noted.
“Democrats voiced concerns that anticipated policy changes, particularly tariff hikes, would lead to a resurgence in inflation,” Hsu said in the release. “Republicans disagreed; they expect the next president will usher in an immense slowdown in inflation.”
Also in this month’s data, the survey showed a large increase in buying conditions for durable goods, which boosted current economic conditions by more than 20%.
“Rather than a sign of strength, this rise in durables was primarily due to a perception that purchasing durables now would enable buyers to avoid future price increases,” Hsu said.
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Stocks rise as unemployment rate edges higher
A jobs report that largely matched hopes for a “Goldilocks” reading sent stocks higher as investors digested a crucial test of the prospects for interest rate cuts in December and beyond.
The Dow Jones Industrial Average (^DJI) gained about 0.3% and the S&P 500 (^GSPC) rose 0.2% after the gauges drifted away from all-time highs at Thursday’s close. Meanwhile, the tech-heavy Nasdaq Composite (^IXIC) increased roughly 0.3%.
The US economy added 227,000 jobs in November, slightly more than expected, as the labor market rebounded from October data that was dinged by severe weather and labor strikes. The unemployment rate unexpectedly ticked up to 4.2%.
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Jobs report: The key numbers
The US labor market rebounded from an October swoon, adding more jobs than expected in November, while the unemployment rate ticked higher to 4.2%.
Here’s the breakdown on the November hiring front:
Yahoo Finance’s Josh Schafer has all the details here.
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