4:11pm: Losing week
Inflation and tariff fears rocked investors during Friday's session and saw the three major stock indexes book losses for the week.
The Nasdaq fell 1.4% to 19,523 points, the Dow Jones fell 1% to 44,403 points and the S&P 500 was down 1% at 6,026 points.
2:50pm: Super Bowl surprise
A Philadelphia Eagles win this Sunday would bode well for the stock market, while a Kansas City Chiefs win might suggest a downturn, according to a theory known as The Super Bowl Indicator.
Introduced by New York Times sportswriter Leonard Koppett in the 1970s, the Super Bowl Indicator suggests that a win by a team from the National Football Conference (NFC) boosts the stock market, while a win from an American Football Conference Team (AFC) signals a potential decline.
Nextech3D.ai secures first customer for Its AI-Powered photography studio, Marmi Stone
It has been correct approximately 72% of the time.
However, the reliability of the indicator has been challenged in recent years.
The stock market was in bull territory following last year's Super Bowl, despite the Super Bowl Indicator suggesting otherwise. The S&P 500 gained 24.2% even though the Kansas City Chiefs, an AFC team, defeated the Eagles to win the championship.
1:45pm: Survival more than victory
The threat of a trade war is shifting into policy, Wells Fargo noted, with proposed tariffs potentially causing stagflationary effects by slowing growth and increasing inflation.
"It felt like a much longer week," analysts at Wells Fargo commented Friday.
The US trade deficit widened sharply in December, up 17% from 2023, highlighting trade policy’s impact on economic trends. Beyond actual policies, even the anticipation of trade measures can influence market and economic behavior.
"It was a week of contradiction, where just when things looked like they were going badly, some mitigating factor offset a prior concern," analysts wrote.
"By Friday, it felt more like survival than victory."
12:40pm: AI spending concerns grow
US stocks are trading lower in midday action, with all three major indices in negative territory. The Nasdaq is leading the decline, down 1.1%, while the S&P 500 has fallen 0.7% and the Dow Jones Industrial Average is off 0.5%.
The market's downturn comes as investors digest the latest jobs report and reassess expectations for interest rate cuts. The US economy added 143,000 jobs in January, falling short of economists' predictions but still indicating resilience in the labor market. The unemployment rate decreased to 4%, down from 4.1% in December.
Treasury yields have edged higher, with the 10-year yield rising to 4.49%, putting pressure on equities. Investors are closely monitoring potential weaknesses in market stability, particularly in light of President Donald Trump's recent tariff initiatives and concerns over rising inflation.
Tech stocks are facing additional headwinds, with Amazon shares falling more than 2% in early trading following a lackluster revenue forecast. This decline mirrors similar trends seen in other tech giants like Google and AMD, as concerns mount over high spending on AI development.
11:05am: Wall Street in the red
Stocks turned red as Friday morning trading got underway, with the Nasdaq dropping 1.1% and the Dow and S&P 500 both losing 0.6%.
"The 143,000 rise in nonfarm payroll employment in January came in a little light of expectations, but upward revisions to recent months' hiring and a decline in the unemployment rate to an eight-month low of 4.0% show the labor market remains on solid footing," analysts at Wells Fargo commented.
9.47am: Stocks mixed on soft non-farm payrolls
Wall Street got off to a mixed start on Friday after figures showed the US economy added fewer jobs than expected but also a surprise drop in unemployment through January.
The Nasdaq added 0.3% after the bell, as the S&P 500 rose 0.1% but the Dow Jones slipped just below the mark.
Non-farm payroll data had shown the addition of 143,000 jobs last month, against the 170,000 expected, alongside a drop in unemployment from 4.1% to 4.0%.
Payrolls were also below the 10-year average of around 180,000 prior to the pandemic, Evelyn Partners chief investment strategist Daniel Casali pointed out.
However, XTB analyst Kathleen Brooks noted January’s California fires and uncertainty following Donald Trump’s inauguration could have impacted the latest figures.
“President Trump’s tariffs and his new economic policy could have meant that employers sat on the sidelines in January, and we will need to see if that continues this month,” she said.
Given focus on the Federal Reserve for any indication around further rate cuts this year, Casali added: “The bottom line is that employment is growing sufficiently.
“The risk of a sharp uptick in the unemployment rate seems contained.”
8.41am: Non-farm payrolls undershoot expectations
Fewer jobs were added across the US economy than expected in January, figures showed on Friday.
According to the US Bureau of Labor Statistics, non-farm payrolls sat at 143,000 for the month, against an upwardly revised 307,000 in December and expectations for 170,000.
Unemployment unexpectedly moderated from 4.1% to 4.0% in the meantime, after annual adjustments in population controls.
Charles Schwab US managing director Richard Flynn noted the soft figures may prompt central bankers’ ears to “prick up” as labour demand slowed.
“That said, it feels unlikely that this report alone would prompt a change in rates.
“We expect that it would take a significant surprise from economic indicators for the Fed to consider deviating from its anticipated plateau, given ongoing uncertainty around the potential impact of upcoming policy changes from the new government administration.”
Futures showed the Nasdaq, S&P 500 and Dow Jones all lower following the figures.
6.33am: Mixed start expected
Futures pointed to a mixed start on Wall Street as Friday brought employment figures into focus after a volatile week.
The Nasdaq was seen 0.1% lower alongside the S&P 500 ahead of the opening bell, while the Dow Jones appeared just above the mark.
Stocks had largely gained on Thursday, with the S&P 500 and Nasdaq both moving higher as fears around US-China trade relations appeared to dissipate for the time being.
Attention on Friday then turned to non-farm payroll and unemployment figures for January and any resultant hint on the direction of interest rates ahead.
Expectations are for fewer jobs to have been added to the economy, at 170,000 against December’s 256,000, as unemployment remains unchanged at 4.1%.
“Investors will also focus on the annual revisions to the jobs figures,” Swissquote Bank analyst Ipek Ozkardeskaya said.
A downward revision would fuel “the narrative that the US jobs market is healthily slowing – a scenario that would allow the Fed to continue cutting the rates but not hurriedly, and keep the market sentiment at a sweet spot,” Ozkardeskaya added.
“A weaker-than-expected NFP figure, and/or rising wages would weigh on sentiment.
“A stronger-than-expected NFP - if combined to softening wages would reinforce the goldilocks scenario.”