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US stocks ended Friday mixed, with the S&P 500 rising to record highs.
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Investor optimism rose after jobs data boosted optimism about the economy and future rate cuts.
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Traders see a higher chance of more rate cuts in December, the CME FedWatch tool shows.
US stocks ended mixed on Friday, although the S&P 500 rose to new records as traders took in November jobs data and increased bets for another rate cut this month.
Bond yields were lower, with the 10-year Treasury down three basis points to 4.151%.
Employers added more jobs than expected last month, and payrolls rose by 227,000 compared to estimates of 220,000, the Bureau of Labor Statistics reported on Friday. The unemployment rate, on the other hand, rose slightly to 4.2%.
A strong job market bolsters confidence that the US economy will avoid a recession, which is good for stocks. However, rising unemployment is leading investors to grow more confident that the Fed will feel comfortable continuing to cut interest rates, as markets eye an 85% rate cut at this month's policy meeting, according to the CME FedWatch Tool.
Here's where the US indices stand at 4:00 pm on Friday's closing bell:
“Today's report clearly tells us that we are not entering a recession. This is the last piece of data that the Fed needs to make its decision later this month. This job report was a quality print and tells us that the job market remains healthy and stable,” Gina Bolvin, president of Bolvin Wealth Management Group, in the statement.
“There is a fine line between normalization and a labor market downturn, but the US still appears to be following a path of normalization,” added Jason Pride, head of investment strategy and research at Glenmede. “A negative tilt in the unemployment rate could help make a strong case for a 25bp rate cut at the Fed this month.”
However, doubts remain as to whether the Fed will continue to cut rates as early as 2025. The probability that rates will remain unchanged by 25 basis points in January – meaning one jump – rose to 63%, up from 58%. last week's price.
Here's what's going on:
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From crypto to meme stocks, the rally looks a lot like the flurry of the pandemic period of the market.
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The Fed should not cut rates in December as the economy appears to be overheating, according to bond experts at JPMorgan Asset Management.
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The US and other crude producers will take more oil market share from OPEC in the coming years, according to Bank of America.
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Insurers face losses of $135 billion after severe weather events around the world this year.
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