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US stocks staged a comeback on Friday as investors digested a big miss in the monthly jobs report and welcomed Amazon (AMZN) and Intel (INTC) earnings.
The tech-heavy Nasdaq Composite (^IXIC) gained 0.8%, while the S&P 500 (^GSPC) rose 0.4%, both coming off a steep sell-off fueled by worries about Big Tech’s artificial intelligence spending. The Dow Jones Industrial Average (^DJI) added roughly 0.7%.
Despite the turnaround on Friday, all three gauges posted losses for the week.
Markets took in their stride the disappointing headline numbers in the all-important jobs report. The US economy added just 12,000 jobs in October, significantly missing expectations. The government said those numbers were weighed down by recent hurricanes and strike activity, most prominently at Boeing (BA).
The report is the last major economic data before the Federal Reserve’s next policy decision on Nov. 7. Market expectations for that meeting moved little in its wake, with traders pricing in about 99% odds of a quarter-point rate cut at the Fed meeting next week, per CME FedWatch.
Read more: What the Fed rate cut means for bank accounts, CDs, loans, and credit cards
Meanwhile, upbeat earnings from Amazon helped dissipate the gloom around Big Tech’s prospects that drove Thursday’s slump in stocks. Its shares jumped over 6% after CEO Andy Jassy said its cloud unit’s AI business was seeing triple-digit revenue growth.
Morale also got a lift from Intel’s (INTC) earnings beat and outlook, which revived hopes for the chipmaker’s turnaround and boosted the stock. But Apple (AAPL) shares slipped as its results and outlook left Wall Street wanting more.
Elsewhere in corporates, Boeing (BA) shares tipped higher after union leaders backed its latest offer to end a significant factory workers strike. The sweetened deal would lift wages by 38%.
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Stocks stage a comeback Friday but post losses for the week
The Friday turnaround fueled by promising results from Amazon (AMZN) wasn’t enough to make up for earlier losses in the week.
The tech-heavy Nasdaq Composite (^IXIC) gained 0.8%, while the S&P 500 (^GSPC) rose 0.4%, both coming off a steep sell-off fueled by worries about Big Tech’s artificial intelligence spending. The Dow Jones Industrial Average (^DJI) added roughly 0.7%.
But all three gauges posted weekly losses.
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A look at the week ahead
The hotly contested presidential election is just days away. Election day highlights an economic calendar that is still filled with major corporate earnings and that features a Federal Reserve policy meeting widely expected to come with another rate cut.
On the earnings front, several entertainment heavyweights are on the docket, including Sony (SONY), Warner Bros. Discovery (WBD) and Paramount (PARA). Sharing economy companies Airbnb (ABNB) and Lyft (LYFT) are also scheduled to report, following Uber’s release this week that beat analyst expectations for revenue.
Investors will also be closely watching the next Fed decision scheduled to arrive on Thursday. Market predictions are nearly certain that the central bank will cut interest rates by 25 basis points, which would mark the second consecutive cut from the Fed but a more modest one compared to the 50 basis point reduction in September. How the Fed will respond to a cooling labor market remains a key question for central bankers. And the policy move will likely carry increased significance as it will come just two days after the election.
Yahoo Finance’s Brent Sanchez has a graphical breakdown of what to watch next week:
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Stocks trending in afternoon trading
Here are some of the stocks leading Yahoo Finance’s trending tickers page during afternoon trading on Friday:
Amazon (AMZN): Shares of the ecommerce giant rose more than 6% off of an impressive earnings report that beat expectations on the top and bottom lines and an outlook for the current quarter that surpassed analyst estimates. Investors also appeared to responded positively to bullish remarks from CEO Andy Jassy on the company’s AI business, which has already generated multi-billion dollars for AWS, Amazon’s cloud unit.
Apple (AAPL): The iPhone maker fell more than 1% Friday following an earnings report that missed expectations for adjusted earnings due to a one-time charge from a European General Court decision. Other results provided a mixed picture, including Greater China sales that fell below estimates but iPhone sales that exceeded expectations.
Abbot (ABT): The medical devices and health care company rose nearly 5% after a legal victory cleared it of liability in a case involving its baby formulas. The ruling is a rare legal win for Abbott, which makes the Similac baby formula, following losses in similar trials tied to a life-threatening disease that affects the colon and intestine.
Intel (INTC): Shares of the tech company rose 8% Friday afternoon after reporting third quarter earnings after the bell on Thursday that beat expectations on revenue. Positive fourth quarter guidance and a beat on data center revenue helped send the stock higher, and added to an overall rebound on Wall Street.
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DJT stock slumps 20% over last 5 days to cap volatile week
Trump Media & Technology Group stock (DJT) extended its three-day slump, falling over 10% on Friday. The move capped off a volatile week that included multiple trading halts and massive swings in both directions just days ahead of the presidential election, reports Yahoo Finance’s Allie Canal.
Over the five-day period, the stock has fallen about 20% despite a double-digit surge to kick off the week. Shares reversed course by Wednesday, suffering their largest percent decline after plunging around 22%.
Since Tuesday, more than $4 billion has been shaved from the company’s market cap, although the stock still has more than doubled from its September lows.
The oscillating of shares between highs and lows will likely continue as the election nears. One investor has warned that if Trump loses the election next week, shares of DJT could plunge to $0.
“It’s a binary bet on the election,” Matthew Tuttle, CEO of investment fund Tuttle Capital Management, told Yahoo Finance’s Catalysts show earlier this week.
Read more about Trump Media shares in the final stretch before the election.
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Harris, Trump respond to final jobs report before election
The US labor market added far fewer jobs than expected in October in a report that was disrupted by weather and worker strikes yet was nonetheless immediately seized upon as a campaign trail issue for the final days of the 2024 election season.
While the White House and Kamala Harris allies focused on the “noisy” nature of the report, the Trump campaign touted the low numbers while also continuing to lob evidence-free charges that they were manipulated, reports Yahoo Finance’s Ben Werschkul.
The jobs report was the capstone of a week that saw economic data take a prominent spot in the 2024 campaign, including the news Wednesday that economic growth largely continued apace and a Thursday release that showed inflation continuing to match expectations.
Harris and her allies have been trying to downplay the number all week, with White House officials previously saying they expected a “noisy” number due to Hurricanes Helene and Milton as well as a short port strike and an ongoing labor stoppage at Boeing.
For Trump’s campaign, the numbers were both a cause for celebration and another opportunity to put forth baseless claims that the officials at the Bureau of Labor Statistics are altering their survey results to benefit the Harris campaign.
Read more about the dueling campaign’s final messages ahead of the election.
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Stocks rise in afternoon trading
Wall Street markets built on early momentum Friday afternoon, as investors embraced a strong earnings report from Amazon (AMZN) and placed the major indexes on track for daily wins.
The tech-heavy Nasdaq Composite (^IXIC) popped 1.1%, and the S&P 500 (^GSPC) rose 0.9%, after both gauges suffered steep losses fueled by after-earnings tumbles in Meta (META) and Microsoft (MSFT) during the prior session. The Dow Jones Industrial Average (^DJI) added almost 1.1%, and was poised to notch a win for the week.
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Amazon, Google show profit growth can quiet fears over heavy AI spending
The quarterly reports this week from Amazon (AMZN) and Google parent Alphabet (GOOG, GOOGL) provided an AI-era playbook for making investors patiently wait for results on massive infrastructure spending.
Alphabet on Tuesday dazzled Wall Street with earnings that beat analysts’ estimates on the top and bottom lines, helped by strong growth in its cloud business.
Even as investors in recent months have expressed impatience with the tech industry’s enormous investments in AI technology, Google and Amazon showed that dominant performance of their core businesses can alleviate those concerns.
But the market hasn’t given all the big-spending tech companies the same leeway when it comes to ballooning capital expenditures.
Microsoft (MSFT) and Meta (META) were met with a more unforgiving response this week, even as they beat analysts’ expectations on earnings and revenue. Investors sent both stocks lower after their respective reports. Wall Street recoiled after executives at both companies said they expect capex to continue increasing in the quarters to come.
Both Amazon CEO Andy Jassy and Alphabet CEO Sundar Pichai have framed their spending on AI as worthwhile endeavors. Investors appear to be taking them at their word.
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Super Micro Computer short sellers gain $2 billion on stock’s rout
Super Micro Computer (SMCI) shares are down 40% from last week — and the stock’s plunge has earned SMCI short sellers $2 billion, according to data from S3 Partners.
Super Micro stock plummeted on Wednesday after a filing revealed that the accounting firm conducting the company’s 2024 fiscal year audit, Ernst & Young, had resigned — adding to the AI server maker’s pile of woes.
EY said in its resignation letter that it was “unwilling to be associated with the financial statements prepared by [Super Micro] management.” The move came two months after a Hindenburg Research report found evidence of accounting violations, among other shoddy business practices, within the company, which prompted SMCI to delay its annual report to the SEC. The Wall Street Journal reported in September that the Justice Department is probing the company.
SMCI shares fell as much as 9% Friday morning, briefly putting the stock in the red year to date before paring losses. The stock has been on a wild ride in recent weeks as investors weigh AI hype against the firm’s turmoil.
“SMCI had been a losing trade all year for shorts, but their fortunes have quickly turned in their favor,” S3 partners managing director Matthew Unterman told Yahoo Finance in an email.
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A disappointing jobs report solidifies bets on another Fed rate cut
Traders now see an interest rate cut from the Federal Reserve next week as a near-certainty after the October jobs report on Friday showed the US labor market added far fewer jobs than expected.
The jobs data is likely the last major economic reading before the Fed’s next policy decision on Nov. 7, and market expectations for that meeting ticked up slightly after its release.
As of Friday morning, markets were pricing in a roughly 99% chance that the Fed cuts interest rates by 25 basis points, according to the the CME FedWatch Tool. That’s up from a 95% chance seen a week ago.
More broadly, other recent data have shown a labor market that’s gradually cooling, reports Yahoo Finance’s Josh Schafer. Job openings fell in September to their lowest level since January 2021, numbers from the Bureau of Labor Statistics showed on Tuesday.
Following the Fed’s move to lower interest rates by 50 basis points in its last policy decision, labor market data has become a crucial metric guiding the size and pace of rate cuts.
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Stocks aim for a comeback after strong Amazon earnings
Wall Street markets were positioned for a turnaround on Friday after a strong showing from Amazon (AMZN) lifted investor sentiment.
The tech-heavy Nasdaq Composite (^IXIC) popped 0.5%, and the S&P 500 (^GSPC) rose 0.4%, both coming off steep losses fueled by after-earnings tumbles in Meta (META) and Microsoft (MSFT). The Dow Jones Industrial Average (^DJI) added 0.4%.
But impressive reports from Amazon and Intel (INTC) set stocks on a comeback trajectory. On Thursday night, Amazon said it expects to make $75 billion in capital expenditures in 2024. CEO Andy Jassy said the company expects to spend “more than that” in 2025, showing investors that heavy AI spending can coincide with profit growth.
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Tech stocks in focus: Amazon, Intel, Nvidia rise while Apple sinks
Amazon (AMZN) and Intel (INTC) stocks jumped Friday, lifting Nvidia (NVDA) shares with them.
Amazon stock climbed as much as 7% in premarket as the company proved it can balance hefty AI spending with profit growth. The company’s profit jumped more than 50% to over $17 billion in the third quarter, and its 11% operating margin came in above Wall Street’s expectations of just over 9%. At the same time, CEO Andy Jassy said the company will likely rack up $75 billion in capital expenditures for the full year and spend even more next year.
That’s good news for Nvidia, whose shares rose 1.5% premarket. The AI chipmaker’s stock had fallen a day earlier amid fears of moderating AI spending from Big Tech firms. The stock was also helped by positive sentiment on Intel, which itself jumped 7.6% premarket after giving an upbeat fourth quarter outlook. Intel’s guidance lifted chip stocks across the board after a rough few days.
Meanwhile, Apple (AAPL) fell roughly 2% after posting weaker-than-expected China sales, a hit from a hefty EU tax payment, and a soft sales outlook for the current period. Apple projected sales will rise in the low-to-mid-single digits in the December quarter, below the 7% expected by analysts.
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Jobs report: Economy adds 12,000 jobs in big miss, unemployment rate holds steady
The US economy added just 12,000 jobs in October, fewer than the 100,000 economists expected. The unemployment rate held steady at 4.1%.
Recent strike activity, most prominently at Boeing (BA), and weather-related disruptions weighed on the labor market last month, the government said.
Yahoo Finance’s Josh Schafer has the details here.
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Good morning. Here’s what’s happening today.
