Wall Street Indexes Wavered After U.S. Jobs Additions Leveled Off

Barry Adams
06 Sep, 2024
New York City

Stocks struggled in early trading on Friday as investors reviewed the latest jobs report and its implication on future rate paths. 

The S&P 500 index decreased 0.2%, and the Nasdaq Composite declined 0.3% after nonfarm payrolls in August accelerated from July but fell short of market expectations. 

The U.S. economy added 142,000 net new jobs in August, higher than the downwardly revised 89,000 jobs in July, according to the U.S. Bureau of Labor Statistics report released on Friday. 

Investors were looking for the nonfarm payroll to increase by at least 155,000 in August. 

The U.S. labor market is clearly softening after expanding by 200,000 jobs a month in 2022 and 2023, but the economy is adding jobs and wages are rising. 

Hourly wages for all employees increased 14 cents, or 0.4%, from the previous month to $35.21 following a 0.2% rise in July, the statistical agency noted. 

Over the past twelve months, wage growth accelerated to 3.8% in August from 3.6% in July, suggesting that higher income will stoke inflationary pressures in the near future. 

Despite the increase in wages, investors are still hoping that the softer labor market conditions are likely to convince policymakers to lower interest later this month. 

 

U.S. Indexes and Treasury Yields

The S&P 500 index decreased 0.4% to 5,484.27, the Nasdaq Composite fell 0.8% to 17,000.87, and the Russell 2000 index added 2.4% to 2,137.11. 

The yield on 2-year Treasury notes edged lower to 3.70%, 10-year Treasury notes decreased to 3.71%, and 30-year Treasury bonds inched lower to 4.0%.

WTI crude oil increased $0.29 to $69.33 a barrel, and natural gas prices edged up 1 cent to $2.26 a thermal unit.

Gold rose by $5.26 to $2,522.01 an ounce, and silver increased by $0.07 to $28.91.

The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 100.88.

 

U.S. Stock Movers

Broadcom declined 9% to $138.93, and the advanced chipmaker reported slightly lower-than-expected revenue in the fiscal third quarter. 

Revenue in the quarter increased 47% to $13.07 billion from $8.9 billion, net income swung to a loss of $1.88 billion from a profit of $6.12 billion, and diluted earnings per share were a loss of 40 cents compared to an income of $1.24 a year earlier. 

The company said net loss in the current quarter includes one-time tax provision of $4.5 billion related to trading of intellectual property rights between two divisions controlled by the company. 

The company estimated fiscal fourth quarter revenue of $14 billion and adjusted operating earnings margin of 64%. 

Broadcom estimated sales from AI parts and custom chips are likely to be $12 billion in fiscal 2024, higher than the previous estimate of $11 billion. 

UiPath increased 1.2% to $12.90, and the software developer reported better-than-expected second-quarter results. 

DocuSign advanced 1.3% to $57.65, and the e-signature company reported better-than-expected revenue and earnings in its latest quarter. 

Bowlero Group advanced 15% to $12.40, and the bowling alley chain operator reported better-than-expected revenue in the fiscal fourth quarter.