Stock Market Today: Stocks Take Jobs-Report Disappointment in Stride

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The much-anticipated August jobs report wasn’t much to crow about.

The Bureau of Labor Statistics revealed Friday that U.S. nonfarm payrolls expanded by just 235,000 last month – while Kiplinger had forecast a “hiccup” in hiring because of the Delta COVID variant, economists still had set a high bar of 720,000 jobs added.

The unemployment rate did tick lower, to 5.2% from 5.4% in July, matching estimates, and year-over-year wage growth of 4.3% was higher than expected. Still, the widely held belief entering Friday was that a strong headline job-growth number would have prompted the Federal Reserve to announce the tapering of its bond purchases later this month, but “that is no longer likely,” says Chris Zaccarelli, chief investment officer for Independent Advisor Alliance.

“Instead, the Fed is going to need to wait to see further improvement in the job market and may not be able to announce their taper plans until the November meeting,” he says.

Rick Rieder, BlackRock’s chief investment officer of Global Fixed Income, points out a number of factors that might have played a role in dragging down the August data, including Delta-variant uncertainty, expanded unemployment insurance benefits and parents still tending to children who weren’t yet back in school.

“September data will be fascinating to examine, in terms of how these things potentially transition (UI benefits ending, Summer weather cools, hospitalizations potentially abate, children return to school, etc.) and how quickly the momentum toward full employment accelerates again,” he says.

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Investors, weighing a significant slowdown in labor momentum but potentially a few months more of maximum market stimulus, settled for inertia.

The Nasdaq Composite (+0.2% to 15,363) modestly advanced to another fresh high thanks to the technology sector’s (+0.4%) leadership Friday. The S&P 500 recorded a marginal decline off yesterday’s highs to 4,535, while the Dow Jones Industrial Average declined a mere 0.2% to 35,369.

And a reminder: The stock market is closed on Monday, Sept. 6, in observance of Labor Day.

Other news in the stock market today:

  • The small-cap Russell 2000 retreated 0.5% to 2,292.

  • Open-source database developer MongoDB (MDB) jumped more than 26% after the company reported a 44% year-over-year spike in revenues to $199 million. What’s more, revenue from its Atlas cloud database surged 83% from the year prior, and now accounts for 56% of total revenue. The company also reported an adjusted per-share loss of 22 cents. Analysts, on average, were expecting $184.2 million in revenue and a 39-cent per-share loss. “MongoDB not only
    continues to build its developer base with new capabilities, but is also seeing rising interest from large enterprises, which increasingly view it as a strategic partner supporting a growing list of use cases, the result of years of go-to-market investment that are now bearing fruit,” Oppenheimer analysts wrote in a note. They maintained their Outperform rating, which is the equivalent of a Buy.

  • DiDi Global (DIDI) got a lift today after a Bloomberg News report suggested several state-run firms in China – including Shouqi Group, a Beijing-based transportation company – were considering an investment in the ride-hailing service. The report cited people close to the matter, though no details have been given or confirmed. DIDI stock rose 2.4% today to close at $9.02, which is still well below its late-June initial public offering (IPO) price of $14 per share.

  • U.S. crude futures gave back 1.0% to settle at $69.29 per barrel.

  • Gold futures popped 1.2% to end at $1,833.70 – their highest settlement price since mid-June.

  • The CBOE Volatility Index (VIX) slipped 0.6% to 16.32.

  • Bitcoin crossed the $50k threshold on Friday, advancing 2.3% to $50,457.20. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m. each trading day.)

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