Here Are 3 Hot Things to Know About Stocks Right Now
- The Dow Jones Industrial Average fell sharply Friday following a U.S. jobs report that was weaker than expected. Stocks were poised for their third weekly loss in four weeks.
- Oil prices jumped Friday after OPEC member states and their allies agreed to cut production for at least six months.
- Broadcom Inc. (AVGO - Get Report) rose 0.58% Friday after the chipmaker posted fiscal fourth-quarter earnings that topped estimates and it issued a forecast higher than analysts' expectations.
Wall Street Overview
Stocks fell sharply on Friday, Dec. 7, after initially rising following a report that said jobs growth in the U.S. in November declined and the unemployment rate remained at a half-century low even amid signs the world's largest economy might be slowing down.
The Labor Department said Friday that non-farm payrolls rose by 155,000 last month, down from 250,000 in October. Economists had projected a gain of 195,000 jobs. The unemployment rate was unchanged at 3.7%, the lowest in 49 years. Average hourly earnings rose by 6 cents to $27.35, leaving them up 3.1% over the past year.
Recent concerns over the health of the economy have reverberated from Wall Street to the Federal Reserve to the White House. The S&P 500 has tumbled over the past month, at least partly due to concerns over slowing growth.
While the Fed has been raising U.S. interest rates since 2015 to keep inflation in check, some economists now say that the central bank is likely to pause in its campaign early next year amid concerns that the economy's strength is buckling under the weight of higher borrowing costs for businesses and consumers.
"Jobs data was slightly weaker than expected, alleviating some of the investor anxiety over the future of interest rates," said Chris Gaffney, president of world markets at TIAA Bank. "A December rate increase is still set in stone, but the slightly weaker jobs numbers will add to the calls for a (Federal Reserve) pause in the first half of 2019."
The Dow Jones Industrial Average fell 559 points, or 2.24%, to 24,388, the S&P 500 declined 2.33%, and the Nasdaq slid more than 3% as tech shares dropped, with Apple Inc. (AAPL - Get Report) falling 3.57% and Alphabet Inc. (GOOGL - Get Report) slipping 2.92%.
Global oil prices surged Friday, taking Brent crude nearly 5% higher, after OPEC member states and their allies agreed to cut production for at least six months following a contentious three-day meeting in Vienna. West Texas Intermediate crude, the U.S. benchmark, jumped 4.4% to $53.77 a barrel.
Broadcom reported adjusted earnings of $5.85 a share and revenue of $5.44 billion. Analysts were looking for earnings of $5.58 on revenue of $5.4 billion. The company also hiked its quarterly dividend by 51 cents to $2.65 a share and added $6 billion to its stock buyback authorization.
The company said it expects revenue of $24.5 billion in fiscal 2019, topping estimates of $22.58 billion. Broadcom guided for its operating margin to be at 51% in fiscal 2019, up slightly from fiscal 2018's 50%.
- Broadcom Gains on Solid Results and Guidance: 5 Key Takeaways
- Broadcom Surges After Solid 2019 Revenue Outlook on Strong Cloud Demand
Cronos Group Inc. (CRON - Get Report) jumped 21.7% after the Canadian cannabis company confirmed that Altria Group Inc. (MO - Get Report) , the maker of Marlboro cigarettes, made a $1.8 billion (C$2.4 billion) investment in Cronos in exchange for a 45% stake.
The company said it expects fourth-quarter revenue of $1.12 billion to $1.13 billion, in line with estimates.