Nasdaq jumps 0.8% in earnings boost

The U.S. stock market closed higher on Friday, with the Dow Jones Industrial Average gaining 288.73 points, or 0.69%, to end at 42,052.19. The S&P 500 advanced 0.41% to close at 5,728.80, while the Nasdaq Composite rose 0.8% to 18,239.92. Amazon rallied 6.2%, driven by strength in its cloud and advertising businesses, exceeding Wall Street’s earnings expectations and offering strong guidance. This helped lift investor sentiment following some notable earnings disappointments earlier in the week. Rob Williams, chief investment strategist at Sage Advisory, noted, “Megacap tech stocks are still ‘the tail wagging the dog.’ You’re seeing some broadening, but it’s still such a massive component right now.” A report released Friday showed the U.S. economy added just 12,000 jobs in October, far below the Dow Jones estimate of 100,000. This marked the weakest level of jobs creation since December 2020. The unemployment rate held at 4.1%, in line with estimates. However, traders did not react strongly to the jobs figures, believing the dismal data was affected by hurricanes and a Boeing strike. Clark Bellin, president and chief investment officer at Bellwether Wealth, said, “Friday’s jobs report showed that the labor market decelerated quite significantly in October compared to September. But this was a noisy number largely due to hurricanes and labor strikes, so it’s unlikely that this weakness is going to cause the Federal Reserve to pivot away from its expected 25 basis point rate cut at the November meeting.” In addition to the upcoming U.S. presidential election on November 5, which has led to elevated volatility, investors are also looking toward the Fed’s two-day policy meeting on November 6-7.

Nasdaq rallies with tech gains

The major averages are wrapping up a choppy week, with the S&P 500 down 1.4%, the Nasdaq off by 1.5%, and the Dow inching down 0.2% week to date. The utilities sector declined 1.9% on Friday, making it the biggest underperformer in the broader market. PG&E fell 9%, Exelon dropped 5.6%, and Duke Energy was down 3.9%. The weaker-than-expected October jobs report showed mixed results for the U.S. economy, with significant job gains in certain sectors. Health care and social assistance added 51,300 jobs, government jobs increased by 40,000, and wholesale trade grew by 10,400 jobs. Boeing shares gained 3.4% after the plane maker reached a tentative agreement with its machinists’ union to end a seven-week-long strike. Cardinal Health gained 5.5% after exceeding fiscal first-quarter earnings expectations and raising its adjusted earnings outlook for fiscal 2025. Intel also saw a rise of 9% after announcing upbeat quarterly guidance. The S&P 500 has seen an unusually strong rally so far in a presidential election year, climbing 19.6% between the start of 2024 and the end of October. This marks the strongest gain for the first 10 months of an election year since 1936.