- Nasdaq, S&P and Dow retreat at the close
- US non-farm payrolls increase by 275,000
- Soldifies likelihood of June rate cut
4:05pm: Investors walk back from tech heavy hitters
The three major US stock indexes finished Friday’s trading session lower as investors pulled back on tech stocks such as NVIDIA Corp (NASDAQ:NVDA, ETR:NVD), which finished the day 5.6% lower at $875.
The tech-heavy Nasdaq led the losses, shedding 1.2% at 16,085 points. The S&P 500 was down 0.7% at 5,123 points and the Dow Jones was down 0.2% at 38,723 points.
Meanwhile, Bitcoin hit fresh highs, surging above $70,000 before retreating to trade at about $69,200 at Friday’s market close.
12:15pm: Stocks show mixed signals after jobs report
US stocks were mixed at the midday point of trading Friday after a strong jobs report reinforced hopes of a June rate cut.
The Dow Jones was still in the green, up 0.2%, but the S&P 500 and the Nasdaq had retreated by 0.2% and 0.6% respectively.
The February jobs figure was close to the consensus estimate of 216,000 but slightly below estimates. Despite a few recent improvements, including claims filings settling above lower readings observed in late December through mid-January, the latest report brought initial claims back up closer to levels seen in early February.
UBS analysts have attributed earlier low readings to what they term "sunbelt seasonality," suggesting a new pattern in US economic data indicating decreased seasonal fluctuations around summer and winter.
They noted that seasonal factors have been slow to adjust to this pattern, potentially influencing the flattening of January claims data. However, when accounting for weekly volatility, the four-week moving average decreased by 1,000 to 212,000, which remains historically low.
10:33am: Global merchandise trade struggles to lift from 2023 slump
Global merchandise trade has been unable to significantly accelerate out of a dip which occurred last year, the World Trade Organisation said.
The WTO's good barometer marginally dropped to 100.6 from 100.7 at the end of November, according to the group's latest data.
A baseline of 100 indicates quarterly growth in line with medium-term trends.
“This suggests that merchandise trade should continue to recover gradually in the early months of 2024, but any gains could be easily derailed by regional conflicts and geopolitical tensions,” the WTO said in its report.
Areas such as export orders and air freight volumes have highlighted signs of positive growth, while container shipping and raw materials continue to lag behind expectations.
10:07am: US rate cut in June likely
Analysts believe the latest US jobs data raises the likelihood of the Fed cutting rates in June.
Charles Hepworth at GAM Investments said: "If we are genuinely seeing the unemployment rate having troughed and moving higher and wage growth slowing, then it obviously pushes the door for rate cuts open wider.
"This was a softer than expected jobs report and raises the likelihood of the Federal Reserve cutting rates in June."
Economists also believe there is "less reason for concern" regarding jobs driving inflation.
Andrew Hunter, Capital Economics' deputy chief US economist, said: "The 275,000 rise in non-farm payrolls in February may, at face value, add weight to the Fed’s view that there is no rush to start cutting interest rates, but the downward revisions to previous months’ gains leave recent growth looking less strong than previously thought.
"Alongside the rise in the unemployment rate to a two-year high and a much weaker rise in wages, there is less reason now to be concerned that renewed labour market strength will drive inflation higher again."
9:42am: Wall Street opens flat as revised US NFPs garner attention
Wall Street opened relatively flat on Friday, following US non-farm payrolls coming in slightly better than expected.
The Dow Jones is trading flat at 38,796, while the S&P is up around 9 points and the Nasdaq has lifted 61 points higher.
It comes as NFPs rose 275,000 last month, beating out the market predictions of a 200,000 jump.
February's unemployment rate came in at 3.9%, slightly higher than the 3.7% that was forecast.
John Lieper, chief investment officer at Titan Asset Management said: “US economic resilience continues as evidenced by today’s gangbuster nonfarm payroll report which came in above expectations.
"However, the big news story is the sizeable downward revision to last month’s reading, from 353K to 229K, corresponding increase in the unemployment rate from 3.7% to 3.9% and slightly weaker wage growth.
"On a net basis this keeps rate cuts on the table. The two-year Treasury yield is lower and equity futures are up. Equities have pivoted from the prior, somewhat narrow focus on monetary policy, towards positive economic surprises and upbeat earnings but today’s data will help support these ongoing tailwinds. “
8:43am: Non-farm payrolls beat guidance to increase by 275,000
Non-farm payrolls increased by 275,000 in February, beating out the market consensus of 200,000 jump.
February's unemployment rate came in at 3.9%, slightly higher than the 3.7% that was forecast.
It means unemployment in the US is at its highest rate since January 2022.
There were also revisions made to the previous two months, with January payrolls reduced to a rise of 229,000 and December's figures changed to 290,000.
Analysts have said today's figures further solidify the prospect of a June rate cut.
Wall Street appeared to react positively to the news in pre-market trading, with the Dow Jones now set to open flat.
The FTSE 100 also lifted slightly from Friday's lows, with the index now around 30 points lower.
8:12am: Wall Street to edge lower ahead of US non-farm payrolls
Wall Street is expected to open slightly lower, with the Dow Jones forecast to slip 108 points as the markets eagerly awaited key non-farm payroll data in the US.
The data, which will reflect US unemployment levels in February, is expected to be steady with last month’s figures.
As per XTB’s Kathleen Brooks, a 200,000 increase in payrolls over February is expected, with unemployment remaining steady at 3.7%.
Average hourly earnings growth is tipped to moderate meanwhile, coming in at 0.2% for February, compared to 0.6% in January.
“This data is worth watching,” Brooks commented, “if the data comes in line with expectations, or below forecasts, this would be seen as a positive development".
This could see Treasury yields fall alongside the dollar and stocks to continue to rally, she explained.
“If there is an upside surprise, then risk sentiment may falter,” Brooks added.
Last month, payrolls increased by 353,000, well above forecasts for a 180,000 jump.