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Stocks End Lower Amid Jobs-Report Shock, Debt-Ceiling Plan

Stocks finish slightly lower following a disappointing September jobs report.

Stocks swung in and out of positive territory Friday before ending slightly lower as investors moved past concern over the debt ceiling and parsed details of a disappointing September jobs report.

The Dow Jones Industrial Average finished down 8 points, or 0.03%, 34,746, while the S&P 500 slipped 0.19% and the tech-heavy Nasdaq was off 0.51% as benchmark 10-year note yields rose to 1.61%.

For the week, the Dow was up 1.2% for its best week since June. The S&P 500 rose 0.8%, while the Nasdaq rose 0.1%.

The Bureau for Labor Statistics said 194,000 new jobs were created last month, with headline unemployment rate falling to a post-pandemic low of 4.8%. 

The September total was firmly south of Wall Street's consensus forecast of 500,000 and the weakest monthly total for the year.

Wages did rise 0.6% on the month, however, and private sector job gains were solid, at 317,000, triggering a mixed reaction for stocks heading into the final session of a volatile week.

Fed Chairman Jerome Powell told reporters last month that it wouldn't take a knockout or super-strong employment report," to begin slowing the pace of purchases, which analysts suggest could last for around 8 months before the entire program is exhausted. From there, the first rate hike is likely to come in September of 2022.

A Senate deal that allowed for a temporary $480 billion addition to the debt ceiling, taking it to $28.9 trillion, will move to the House for a floor vote next week and push the entire debate into early December.

The agreement -- which passed the Senate  by a vote of 50-48 -- triggered the largest single-day rally in global stocks since May and put Wall Street firmly into the green at the close of trading. 

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Energy markets, however, continue to test market bulls as oil approaches the highest levels in seven years again Friday amid the rolling power crunch -- and natural gas prices surges -- in Europe and China.

"The miss on jobs isn’t pretty—there’s no way around it. And many may believe it will cause the Fed pause in terms of their tapering strategy," Mike Loewengart, managing director of investment strategy with E*Trade Financial. 

He said that the jury is out on how the market will interpret the data — on one hand it’s a knock to our economic recovery, on the other, delaying Fed policy means the easy money era continues.

"Keep in mind though that this read on the labor market is backward looking," Loewengart continued, "and there were some bright spots in the report with the unemployment rate ticking down and wages moving higher."

Energy markets, however, continue to test market bulls as oil approaches the highest levels in seven years again Friday amid the rolling power crunch -- and natural gas prices surges -- in Europe and China.

WTI futures for November delivery were up 1.48% to $79.46 per barrel, while Brent contracts for December, the global benchmark, were 0.62% higher to $82.46 per barrel.

Tesla  (TSLA) - Get Tesla Inc Report shares finished down 1% after founder and CEO Elon Musk unveiled plans late Thursday to move the clean-energy carmaker's headquarters from California to Texas, the site of its developing gigafactory and the home of SpaceX's test launching facility. 

Home Depot HD shares ended down with its smaller rival Lowe's  (LOW) - Get Lowe's Companies, Inc. (LOW) Report following suit, after analysts at Loop Capital cut their ratings on both companies, citing 'significant' supply chain risks for the home improvement retailers.

Apple  (AAPL) - Get Apple Inc. (AAPL) Report shares were off slightly after the iPhone maker's main phone rival, Samsung Electronics, forecast its strongest quarterly profit in three years thanks in part to a surge in global semiconductor prices and solid demand of its new foldable smartphone.