S&P 500 and Nasdaq Composite Dropped 1% After December Jobs Report

Barry Adams
10 Jan, 2025
New York City

Stock market indexes tumbled after a hotter-than-expected labor market report sent bond yields higher. 

The S&P 500 index decreased 1%, and the Nasdaq Composite fell 1.2% after the nonfarm payrolls expanded at a faster-than-expected pace in December, confirming the view that the Fed is likely to keep higher rates for longer. 

Nonfarm payrolls rose 256,000 in December, and the jobless rate held steady at 4.1%, and average hourly earnings advanced 3.9% from a year ago, according to the monthly report released by the U.S. Bureau of Labor Statistics. 

For the full year 2024, payrolls expanded at an average monthly pace of 186,000, totaling 2.2 million, lower than the 251,000 monthly rate totaling 3.0 million in 2023. 

The labor force participation rate, at 62.5%, was unchanged over the month and has remained in a narrow range of 62.5% to 62.7% since December 2023. 

The employment-population ratio, at 60.0%, changed little over the month and over the year.

 

U.S. Indexes and Treasury Yields

The S&P 500 index decreased 0.8% to 5,867.83, the Nasdaq Composite fell 1.0% to 19,272.05, and the Russell 2000 index inched down by 0.4% to 2,238.93. 

The yield on 2-year Treasury notes edged higher to 4.36%, 10-year Treasury notes inched up to 4.76%, and 30-year Treasury bonds increased to 4.98%.

WTI crude oil increased $2.86 to $76.80 a barrel, and natural gas prices edged up 13 cents to $3.83 a thermal unit.

Gold increased by $10.70 to $2,680.61 an ounce, and silver rose by $0.15 to $30.24. 

The dollar index, which weighs the US currency against a basket of foreign currencies, decreased by 0.03 to 109.13 and traded at a two-year high. 

 

U.S. Stock Movers 

Walgreens Boots Alliance Inc. increased 14.4% to $10.55 after the pharmacy chain operator reported better-than-expected quarterly results. 

Delta Ai Lines Inc. gained 7% to $65.71 after the company reported better-than-expected quarterly results, and the company guided strong earnings and free cash flow in 2025. 

Revenue in the December quarter increased to $1.7 billion from $1.3 billion, net income decreased to $843 million from $2.03 billion, and diluted earnings per share fell to $1.29 from $3.67 a year ago. 

The company guided continued increases in revenue and higher demand for its premium products in 2025 and estimated pre-tax income of more than $6 billion, earnings per share of at least $7.35, and free cash flow to surpass $4 billion.