Stocks Recover From Session Low After Employment Data
4:08 pm Friday, September 03rd, 2021
Benchmark Treasury yields jumped on Friday on fears of rising inflation but some equity markets rose after a weak U.S. jobs report likely pushed back the timetable for when the Federal Reserve starts to reduce its massive support of the economy.
Today’s biggest focus has been the release of the Employment Situation report for August, which missed headline estimates (actual 235,000; consensus 750,000) but exceeded average hourly earnings estimates (actual 0.6%; consensus 0.3%), giving the Fed room to delay its tapering announcement.
The weak headline reading invited some slight opening pressure on stocks, but the S&P 500 has been able to narrow its loss after bouncing off its closing level from Wednesday, resulting in range-bound trade ahead of a three-day weekend.
The technology sector (+0.4%) has held a modest gain since the start, which is preventing the benchmark index from showing a wider loss. The tech sector is on course to gain 0.9% for the week with chipmakers fueling today’s outperformance. NVIDIA (NVDA) is nearing a fresh record while Broadcom (AVGO) rallied toward its record high from August 30 before narrowing its gain. Broadcom’s rally took place after the company beat Q3 expectations and issued strong guidance for Q4.
On the downside, the remaining ten sectors show losses between 0.1% (communication services) and 0.9% (energy). The energy sector has widened this week’s loss to 1.8% as crude oil falls $0.50, or 0.7%, to $69.49/bbl.
Treasuries sit just above their lows after slipping in the wake of the August jobs report. The 10-yr yield is up three basis points at 1.32%, sitting between its 50-day (1.309%) and 200-day (1.341%) moving averages.
