The Nasdaq Composite extended its winning streak to three weeks Friday, a move driven by labor market data that suggests the Federal Reserve may hold interest rates steady later this month. The index closed up 1.2% at 27,190.86. The S&P 500 rose 0.7% to 7,722.72, and the Dow Jones Industrial Average gained 0.5% to 51,176.96.
For the week, the Nasdaq posted a 0.5% gain. The Dow and S&P 500 both finished lower, with weekly losses of 1.3% and 0.3%, respectively. All sectors ended Friday in positive territory except healthcare, with consumer discretionary leading the advance.
The Bureau of Labor Statistics reported that total nonfarm payrolls increased by 29,000 last month. That figure is roughly one-third of the 90,000 gain projected in a Bloomberg-compiled survey. The agency also revised August's increase down by 29,000 to 133,000, while July's tally turned negative.
Thomas Simons, chief US economist at Jefferies, called the report a decisive factor against further rate increases in a note to MT Newswires. Simons stated that while the Federal Open Market Committee had previously signaled successive 25-basis-point moves, policymakers now appear more likely to remain patient given the available time before another hike is needed.
The Fed raised rates by 25 basis points last month, its first hike in over three years, to address inflation that has remained above its 2% target. The central bank's dot plot had indicated a possibility of further increases later this year. However, market expectations have shifted sharply. The CME FedWatch tool now shows a 77% probability that the FOMC will leave its benchmark lending rate unchanged at the end of this month, up from 36% a week earlier. The odds of a second consecutive 25-basis-point hike dropped to 23% from 64%.
Treasury yields climbed despite the weak jobs report. The two-year rate rose 5.2 basis points to 4.84%, and the 10-year rate added 4.7 basis points to 5.28%. In energy markets, prices were mixed after the Group of Seven outlined plans to release 100 million barrels of oil and diesel products over four months due to volatility from the US-Iran war. West Texas Intermediate crude fell 1.4% to $91.54 per barrel, while Brent rose 0.5% to $102.86. WTI is on track for its third consecutive weekly decline.
In equities, Tesla shares jumped 4.7% after third-quarter deliveries exceeded Wall Street expectations. Ford Motor fell 1.4% following a year-over-year decline in US vehicle sales for the quarter. Nvidia gained 1.3%, supported by Morgan Stanley reinstating the chipmaker as its top semiconductor pick. Nike dropped 3.6%, the largest decline on the Dow, after forecasting a fiscal 2027 revenue decline and announcing an operating model transformation amid Truist Securities warnings about delayed turnaround timelines. Spot gold ended the day down 0.8% at $4,145.06 per troy ounce, while silver fell 0.7% to $60.78 per ounce.