Stocks experienced an upswing on Friday, marking a positive start to November, primarily driven by Amazon’s strong performance, which helped lift major technology shares despite a weak jobs report.
The Dow Jones Industrial Average rose by 465 points, equivalent to a 1.1% gain, while the S&P 500 and the Nasdaq Composite saw increases of 0.9% and 1.2%, respectively. Amazon’s stock surged over 7%, buoyed by solid performances in its cloud services and advertising sectors, surpassing Wall Street’s earnings projections. Additionally, Intel’s shares climbed nearly 8% after reporting better-than-expected revenue and providing robust future guidance. This enthusiasm from prominent technology companies helped counterbalance some of the disappointments observed earlier in the week.
Rob Williams, chief investment strategist at Sage Advisory, noted that major tech stocks continue to play a significant role in market movements. He commented, “Megacap tech stocks are still the tail wagging the dog,” suggesting that while there may be a broader market performance, these companies remain a major influence.
On the labor market front, the jobs report released Friday revealed the U.S. economy added a mere 12,000 jobs in October, falling short of the Dow Jones estimate of 100,000. This report indicated the slowest job creation rate since December 2020, although the unemployment rate held steady at 4.1%, consistent with estimates. Despite the disappointing figures, traders appeared unfazed, attributing the data to external factors such as hurricanes and a strike at Boeing.
Clark Bellin, president and chief investment officer at Bellwether Wealth, remarked that the weak jobs data is not likely to prompt a significant shift in the Federal Reserve’s upcoming policies, especially with expectations for a 25 basis point rate cut in November still intact.
Investors remain vigilant, especially with the U.S. Presidential election approaching on November 5, which has led to heightened market volatility. Attention is also focused on the Federal Reserve’s two-day policy meeting set for November 6 and 7.
As the week concludes, the major indexes have had a fluctuating performance, with the S&P 500 and Nasdaq down by 0.9% and 1.1% respectively, largely influenced by declines following earnings reports from Microsoft and Meta Platforms. Conversely, the Dow recorded a modest increase of 0.3%.
As we move into November, the market’s resilience is evident, showing a willingness to rebound despite challenges faced in the previous month. This indicates potential for recovery and investment opportunities ahead, offering hope for investors and a bright outlook for equities in the coming weeks.