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Stocks Tick Lower Amid Jobs-Report Shock, Debt-Ceiling Plan; Oil Hits $80

A disappointing September jobs report offset yesterday's debt-ceiling deal rally, and has stocks swinging in and out of positive territory in the Friday session.

U.S. stocks swung in and out of positive territory Friday, while Treasury note yields held near the highest levels since early June, as investors moved past concern over the debt ceiling while parsing details of a disappointing September jobs report.

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 tally was firmly south of the Street 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.

"Friday’s mixed jobs number suggests little shift in the economic growth narrative," Richard Saperstein, chief investment officer at Treasury Partners. "While the headline number was much weaker-than-expected, the economy saw decent job growth in the private sector during September as well as a decline in the unemployment rate."

"Despite the relatively soft jobs report, the Federal Reserve remains on course to begin tapering its stimulus in November or December," he added. "One weaker-than-expected jobs number is not likely to change the Fed’s thinking."

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.

At last check stocks edged lower, the Dow industrials by 0.16%, the S&P 500 by 0.26% and the Nasdaq by 0.54%.

The tech-focused Nasdaq Composite fell as benchmark 10-year note yields held at close to 1.61% in New York trading following the jobs-data release, the highest since early June.

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. 

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The agreement -- which passed the upper chamber 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.

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 marked $1.371 higher on the session at $80.01 per barrel, the highest since November 2014, while Brent contracts for December, the global benchmark, were last seen $1.21 higher at $83.15 per barrel. 

Tesla  (TSLA) - Get Tesla Inc Report shares were an active pre-market mover, falling 1.12% to $784.75 each 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.

Musk also said he hoped the global shortage in semiconductors "will alleviate soon", adding he was confident of adding to the carmaker's record third quarter delivery total. 

Home Depot  (HD) - Get Home Depot, Inc. (HD) Report shares were also lower 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 also on the move, rising 0.13% to $143.50 after the iPhone maker's main 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.

In overseas markets, Europe's Stoxx 600 edged 0.2% lower in a muted session as investors eyed the non-farm payroll report at 1:30 PM Frankfurt time, while China shares gained on their first trading session following the Golden Week holiday to help the region-wide MSCI ex-Japan index gain 0.2% heading into the final hours of trading.