4:05pm: US equities end higher as new jobs rise
US stocks closed higher after a better-than-expected October jobs report.
Employment gains for the month totaled 531,000, beating consensus estimates for 450,000 new jobs. The US Labor report also revised September’s disappointing number up to 312,000 job gains from 194,000 previously and increased its August number by a similar amount.
Also driving positive sentiment was Pfizer which said that its COVID-19 drug, used with an HIV drug, cut the risk of hospitalization by 89%.
On the day, the Dow Jones Industrial Average increased by 202 points, or 0.56%, to 36,342 and the S&P 500 rose 0.34% to 4,696 (the 7th positive day in a row for the index).
And the tech-heavy Nasdaq climbed 0.18% to 15,970.
1.00pm: US stocks maintain gains
US stocks rose in afternoon trade after Labor Department data showed job growth rebounded in October following a summer slowdown.
The Dow Jones Industrial Average ticked up 0.5%, or 195 points, while the tech-heavy Nasdaq Composite Index rose 0.1%. The S&P 500 ticked up 0.6%.
All three indices are on course to post weekly gains, as well as to notch fresh closing records.
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9.37am: US stocks start ahead
US stocks started higher on Friday after the US labor market was shown to have picked up last month.
The Dow Jones Industrial Average advanced around 160 points at 36,285 in early deals in New York. The broader-based S&P 500 gained over 24 points at 4,704. The tech laden Nasdaq index added around 74 points at 16,014.
Official non-farm payroll figures showed that the US had added 531,000 jobs in October - a sharp acceleration from September’s revised 312,000 payrolls number and August’s revised reading of 483,000.
Analysts at investment and banking giant ING noted the decent jobs data, but said there was "still a sense of mild disappointment".
"Labour supply simply isn't returning and for companies desperate to hire this is a problem. Pay will have to be bid higher, with those costs increases likely passed onto consumers," they said.
"There was no real improvement in labour supply with the participation remain remaining at a woeful 61.6%. Nearly 40% of people of working age are not engaged in the labour market in any meaningful way and with companies desperate to hire the jobs figures could be so much better if workers were available. This in turn is holding back the productive capacity of the US economy so growth is not as good as it should be while boosting inflation pressures as companies compete for staff."
8.45am: Jobs growth strong
The latest US jobs data showed non-farm payrolls (NFP) added 531,000 in October, more than the 400,000-plus expected, while the unemployment rate fell to 4.6%, as the labor market rebounded from a summer lull.
Job growth slowed in both August and September, when payrolls significantly missed forecasts as the coronavirus (COVID-19) Delta variant impacted hiring.
In a quick reaction piece, Walid Koudmani, XTB Market analyst noted: "The highly anticipated US NFP report came in slightly above expectations at 531K vs 455K and showed Average Hourly Earnings m/m change of 0,4% confirming the ADP report which indicated an increase of over 500K earlier this week. Stock indices in Europe and US futures were trading higher ahead of the US jobs data release and have managed to maintain their gains as they hover around all-time highs.
"Furthermore, the US dollar continues to be one of the best performing currencies with GPBUSD pair reaching the lowest level in over a month after the BoE decided to leave rates unchanged in its most recent meeting. The report comes after the FED’s announcement of QE tapering which also did not have a significant impact on stocks, as it was mostly priced in. On the other hand, today’s NFP could highlight the importance of macro data for the central bank and may lead to discussions related to rate hikes in the near future, as Powell stressed the significance of wage data on potential future changes in policy. In either case, the FED will be under increasing pressure to reassure markets against the risks of what it has maintained is “transitory” inflation as other central banks begin to take steps to adjust fiscal and monetary policy."
6.45am: US stocks seen opening in the green
US stocks are expected to open higher as investors await the key October employment report, due out before the opening bell.
Futures for the Dow Jones Industrial Average rose 0.02% in Friday pre-market trading, while the broader S&P 500 index added 0.22% and those for the tech-heavy Nasdaq 100 gained 0.5%.
US stocks finished mixed on Thursday, a day after the Federal Reserve said it will begin to slow its bond-buying program later this month, signaling that the economy can now handle an unwinding of coronavirus pandemic stimulus.
At the close, the Dow had slipped 33 points to 36,125, while the S&P 500 gained 20 points at 4,680 and the tech-heavy Nasdaq climbed 129 points, or 0.8%, to 15,940.
“We’ll cap off a very busy macro week today with the US jobs report for October,” commented Jim Reid, a strategist at Deutsche Bank. “In terms of what to expect, our US economists are looking for a +400,000 increase in non-farm payrolls, which in turn would send the unemployment rate down a tenth to a post-pandemic low of 4.7%.”
Reid noted that the last couple of jobs reports have seen some downside surprises, but if realised, the addition of more than 400,000 positions would be the strongest jobs growth in three months.
Ahead of today’s employment report, Reid said there has been some fairly positive labour market data, with the ADP report of private payrolls exceeding expectations on Wednesday at 571,000 versus the 400,000 expected, while weekly initial jobless claims for the week through October 30, 2021, fell to a fresh post-pandemic low of 269,000 against the 275,000 that were expected.
“The Fed made it clear this week that labour market evolution after the delta variant will be a key determinant in the future path of monetary policy,” Reid concluded.