The rest of the global economy might be in trouble, but the U.S. keeps going from strength to strength.
A blowout number of jobs were added to U.S. nonfarm payrolls in December. Last month, 292,000 jobs were added to the economy, well over economists' expectations for 200,000 jobs. The unemployment rate was unchanged at 5%, as expected.
U.S. stock futures staged a rebound after six days of declines. S&P 500 futures added 1.2%, Dow Jones Industrial Average futures were up 1.1%, and Nasdaq futures rose 1.3%.
The recovery follows a volatile end to Thursday's session. The Dow briefly fell more than 400 points on Thursday, while the Nasdaq entered a correction, falling more than 10% from its 52-week high set in July.
Expectations for Federal Reserve rate hikes this year shifted after the better-than-expected jobs report. Fed funds futures suggest a 52% change of a rate hike as soon as March, above previous estimates of around 40%. Previous odds bet on a rate hike no sooner than June.
China's Shanghai Composite closed 2% higher to close out a dismal week. Markets rebounded on Friday after Chinese officials boosted the yuan midpoint rate for the first time in nine days. However, the index was still down 10% for the week after devaluation of the yuan sparked concerns over the health of the Chinese economy.
The China Securities Regulatory Commission also decided to suspend the circuit-breaker system that went into effect on January 1. Chinese markets have triggered the mechanism twice in just four days.
American Eagle Outfitters (AEO) plunged 12% after warning sales could miss estimates as a warmer winter limited demand for seasonal apparel. The teen retailer forecast same-store sales to rise 4% so far this quarter, below estimates of 4.7% growth.
Urban Outfitters (URBN) added 2.4% in premarket trading despite a disappointing holiday-shopping period. The retailer reported a 2% decline in same-store sales for the two months to end last year, while total company sales were flat.
Apple (AAPL) suppliers were sharply lower on fears the tech giant has scaled back iPhone production on weaker demand and inventory buildup. Semiconductor supplier Qorvo (QRVO) tumbled 9% after lowering its third-quarter outlook due to softer sales of its mobile products. Fellow suppliers such as Cirrus Logic (CRUS) , Avago (AVGO) , and Skyworks (SWKS) were also lower.
The Container Store (TCS) tumbled 20% in premarket trading after swinging to a quarterly loss. The retailer reported a quarterly loss of 4 cents a share compared to profit of 13 cents a share a year earlier after higher promotional spending ate into profit.
Bed, Bath & Beyond (BBBY) added 1% even as quarterly profit fell 21%, driven by a sales decline at existing stores. However, the homewares retailer did see a strong online performance with comparable digital sales up 25% from a year earlier.