Stock markets fluctuate after jobs report shatters expectations

Posted on by MediumTimes

US stocks fluctuated on Friday as a jobs report, considered crucial for interest rate cut expectations, showed stronger-than-expected hiring growth.

The S&P 500 (^GSPC) gained 0.1%, while the Dow Jones Industrial Average (^DJI) added 0.2%, breaking out from a sluggish Thursday session for all three major indexes. The tech-heavy Nasdaq Composite (^IXIC) remained in the red, hovering just below the flatline.

Investors have bought stocks in anticipation that further data will indicate a slowdown in the economy. But the Labor Department’s report offered further evidence that some parts of the economy are too hot for the central bank’s battle against inflation, bolstering the narrative of keeping rates high for longer.

The much-anticipated May jobs report reinforces the view that interest rates will likely not be brought down from two-decade highs until the autumn.

The US economy added 272,000 jobs in May, far exceeding expectations. However, the unemployment rate increased, rising to 4.0%.

Read more: How does the labor market affect inflation?

On the other side of the market, investors are also awaiting a promised livestream from GameStop (GME) booster Keith Gill, aka “Roaring Kitty.” The event, scheduled for Friday at 12pm ET, will be Gill’s first live YouTube show since he helped ignite the meme stock rally three years ago.

GameStop shares closed up 47% on Thursday, but then fell sharply after the video game retailer said it would sell 75 million shares and reported a decline in sales in the first quarter.

Also set to complete is Nvidia’s (NVDA) 10-for-1 stock split, expected after the market close. A mid-week rally briefly lifted the AI ​​chipmaker to a $3 trillion valuation, but its shares have since fallen as short bets against the company have mounted.

stay8 Updates

  • GameStop drops 35%, retail trader Keith Gill says he has confidence in the company’s management

    GameStop (GME) stock was halted multiple times due to volatility during retail investor Keith Gill’s highly anticipated livestream.

    “Can I talk about GameStop? The funny thing is I have the same feelings about everything, you know?” Gill said as he appeared in front of a Yahoo Finance screen during the livestream.

    “It’s like betting on management,” Gill said. “Ryan Cohen and his team — that’s what people should be focusing on.”

    Cohen is the chairman and CEO of GameStop.

    “I think this person might be able to do it,” Gill said, also clarifying that his video is not financial advice.

    Gill also confirmed that screenshots posted online this week of massive GameStop buys were his own.

    The stock had fallen on Friday and was also hit by volatility early in the session after GameStop announced its quarterly results. missed analysts’ estimates and announced a stock sale.

    The stock was down 35% as of 1 p.m. Eastern time.

  • Stock market in green mark in afternoon trade, Keith Gill starts livestream

    All three indexes were up on Friday afternoon, recovering from earlier declines after the key jobs report came in warmer than expected.

    Investors were also greeted by the reappearance of bullish retail investor Keith Gill, who began a YouTube livestream in the afternoon session. The stream marked his first live appearance on the channel since the investor helped ignite the meme stock rally in 2021 through his bullish videos and posts about video game retailer GameStop (GME).

    The S&P 500 (^GSPC) gained 0.2%, while the Dow Jones Industrial Average (^DJI) added 0.1%, breaking out from a sluggish Thursday session for all three major indexes. The tech-heavy Nasdaq Composite (^IXIC) also gained 0.1%.

  • GameStop investors set for Roaring Kitty livestream

    GameStop shares fell more than 18% on Friday, just minutes ahead of a highly anticipated livestream from “Roaring Kitty,” the nickname used by bullish retail investor Keith Gill.

    The livestream will air on Gill’s YouTube account at 12pm ET after the video game retailer announces its quarterly results. missed analysts’ estimates and news of stock sales.

    As Yahoo Finance said Ines Ferre report, gamestop Filed An additional 75 million shares will be sold following the sale of 45 million shares last month, raising proceeds of about $930 million.

    The announcements come after the stock surged 47% in the previous session after “Roaring Kitty” scheduled his YouTube live stream. Friday’s event will mark the first live appearance on the channel since the investor helped ignite the meme stock rally in 2021 through his bullish videos and posts about the video game retailer.

    Gill’s actions and announcements could serve as another catalyst for this stock and other names in the meme stock basket.

    Earlier this week, an account believed to be linked to Gill disclosed a $175 million bet on GameStop. That post also sent shares surging.

  • Jobs report is a ‘Rorschach blot’ for mixed interpretations

    The U.S. labor market added more jobs than expected in May, but the report included both optimistic and pessimistic figures, which Comerica Bank chief economist Bill Adams called a Rorschach blot.

    data from Bureau of Labor Statistics Data released on Friday showed the labor market added 272,000 non-farm payroll jobs in May, well above the 180,000 expected.

    But the unemployment rate rose to 4% from 3.9% the previous month.

    “Those optimists about the growth outlook will view solid payroll growth as a sign that the expansion is continuing unabated,” Adams said in a note Friday. “Pessimists will focus on the unemployment rate rising to its highest level since the start of 2022, a rise in part-time employment, and a decline in temporary employment, often a leading indicator of broader job market weakness.”

    How market observers interpret the latest jobs data affects the interest rate outlook.

    “Most Fed policymakers will view May’s strong payroll growth and income growth as a sign that an immediate rate cut is not necessary,” Adams said. But the Fed will also view last year’s rise in unemployment as a sign that inflation is further down, he said.

    “If core inflation continues to slow over the next few months, the Fed will feel comfortable lowering interest rates by as much as a quarter of a percentage point at its September meeting.”

  • Stock trends in morning trade

    Here are some of the stocks that topped Yahoo Finance’s trending ticker page during morning trading on Friday.

    GameStop (GME, Shares of the video game retailer and meme stock standout fell 19% on Friday morning after it reported quarterly results. missed analysts’ estimates and announced the stock sale just hours before a highly anticipated livestream from “Roaring Kitty,” a nickname used in the past by bullish retail investor Keith Gill.

    DocuSign (Document, This software company specializing in electronic agreements tumbled 8% after reporting second-quarter billing guidance that fell short of Wall Street expectations. However, investors overlooked more positive updates, as the company exceeded earnings estimates and increased its stock repurchase program to $1 billion of outstanding common stock.

    Lift (Lift,: Shares of the ride-hailing company rose 3% on Friday morning after the company decided to revise its growth forecasts and reaffirm its guidance for the second quarter. Lyft now expects bookings to grow by about 15% over the next three years.

    Vail Resorts (MTN, Mountain Resorts fell 13% after the company missed earnings expectations and cut its full-year EBITDA outlook. CEO Kirsten Lynch cited the lack of a surge in lift ticket visitors in the spring as a reason for the lower guidance.

  • Stock market falls as interest rate cuts expectations fade

    The May jobs report, which came in hotter than expected, put another dent in the narrative that the Federal Reserve will soon cut interest rates. The latest reading provided another signal that belies previous signs of a slowdown in the economy.

    The S&P 500 (^GSPC) lost 0.3%, while the Dow Jones Industrial Average (^DJI) lost 0.2%, breaking from Thursday’s sluggish session for all three major indexes. The tech-heavy Nasdaq Composite (^IXIC) lost nearly 0.4%.

  • Keep an eye on Robinhood

    Robinhood (HOOD) has been on several impressive streaks.

    For one, the stock price: it’s up 27% in the last 30 days. And two, the news flow – from the launch of a new credit card to a strong first-quarter earnings report to spending $200 million to buy crypto exchange Bitstamp yesterday.

    “This is a strategic move by HOOD to expand its crypto business, and we believe it validates our belief that HOOD is a great way to gain crypto equity exposure at the start of an exciting new crypto cycle,” Bernstein’s Gautam Chhugani said this morning.

    I had coffee with Robinhood co-founder and CEO Vlad Tenev yesterday afternoon after the Bitstamp deal. The guy has regained his cool, but you can see he’s got a new experience from what he did several years ago – from layoffs to testifying on the GameStop (GME) madness. Keep an eye on what the company does in wealth management.

    Our final conversation below.

  • What to remember when reading the jobs report

    The market still wants to believe in interest rate cuts for 2024.

    So keep this in mind as you read today’s jobs report and plan for how it might influence Fed policy.

    Nice thing to say by Jim Reid of Deutsche Bank this morning after the ECB cut interest rates yesterday:

    “And even though the tone was a bit hawkish in many cases, it has now become the fourth G10 central bank to cut rates, following Canada, Sweden and Switzerland. In turn, this move has cemented the idea that the global monetary policy cycle is moving towards an easing mode, with investors expecting further cuts on the horizon. So this is a big change from the last few years, when central banks were raising rates rapidly in an attempt to tame inflation.”

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Disclaimer : The content in this article is for educational and informational purposes only.

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