The market had a more optimistic coloring to it by midday compared with the morning.
Friday morning, the S&P 500 was down 0.45% and the 10-Year Treasury yield was down to 0.53%. Inflation and economically sensitive stocks were mostly down.
By midday, some cyclical sectors were up and the S&P 500 was down 0.2%, dragged down by the tech-heavy Nasdaq’s loss of 0.5%. Consumer discretionary and oil were down, but industrials and banks were up slightly. Banks turned positive when the 10-Year yield rose to 0.57%. This was all by noon EDT.
The U.S. added 1.76 million jobs in July, better than the expectation of roughly 1.5 million. The unemployment rate fell to 10.2% from over 11%. This points to a fast economic recovery, although investors are still tepid on the near-term outlook, as the relatively small fiscal stimulus bill is still stuck in Congress, while small businesses and households are in need.
Some, not necessarily most, large cap large cap consumer staples — defensive in nature — were rising slightly, as investors were compelled to stay in safes areas of the financial market.
And as some investors look for growth tech stocks that can power through economic headwinds that are not the FAANG stocks, Uber (UBER) - Get Report wasn’t providing much help. Uber posted better-than-expected revenue and a slimmer adjusted EBITDA loss Thursday after the bell, but the stock fell 5.6% Friday. Food delivery surged amidst the at-home environment, while question marks around the rides business’ recovery remain. Analyst opinions on whether to move 2021 estimates up or down are fairly diverse.
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