U.S. stocks opened higher on Friday as investors digested a crucial jobs report that provided clues about the size of an expected interest rate cut this month and the resilience of the U.S. economy.
Technology stocks reversed earlier losses, with the Nasdaq Composite (^IXIC) up about 0.2% in early trading. The S&P 500 (^GSPC) and the Dow Jones Industrial Average (^DJI) also rose about 0.2% each.
The US economy added 142,000 jobs in August, below expectations for about 165,000 jobs. Job growth in the previous month was also revised down as the labor market showed signs of continuing to cool. However, the unemployment rate fell back to 4.2%.
The report altered expectations that the Federal Reserve will deliver a more substantial rate cut at its meeting in less than two weeks. According to the CME FedWatch tool, traders see a 50-50 chance of a 50-basis-point cut, which represents a significant increase from Thursday.
Despite the anemic closes, stocks have been swinging this week as the market evaluated incoming economic data to set expectations about the size of the Federal Reserve’s rate cut. All three indexes are headed for significant weekly declines.
Read more: Fed Predictions for 2024: What Experts Say About the Possibility of a Rate Cut
Meanwhile, in corporate news, shares of chipmaker Broadcom (AVGO) fell in early trading following a lackluster sales forecast. While the Apple supplier is benefiting from a surge in spending on artificial intelligence, its other divisions are not keeping up.
Live2 updates
