U.S. stocks rose Friday afternoon after a jobs report for August showed that a fewer-than-expected 130,000 new jobs were created in the month; perhaps, supporting market hopes for a rate cut later this month without signaling that a full-blown domestic recession was at hand.
Fed Chairman Jerome Powell, meanwhile, described the economy and labor market as healthy, speaking at a question-and-answer in Switzerland after the jobs report.
How are major benchmarks performing?
The Dow Jones Industrial Average YMU19, +0.49%[1] rose 104 points, or 0.4%, to 26,832, while the S&P 500 index ESU19, +0.38%[2] added 7 points, or 0.2%, to 2,983. The Nasdaq Composite Index COMP, +0.13%[3] advanced 9 points, or 0.1%, to reach 8,125.
For the week, the Dow is on track to post a 1.6% rise, the S&P 500 is set for a 1.9% gain and the Nasdaq is on pace for a 2% advance, according to FactSet data.
On Thursday, the Dow rose 372.68 points, or 1.4%, to 26,728.15, while the S&P 500 index advanced 38.2 points, or 1.3%, to reach 2,975.98. The Nasdaq Composite Index rose 139.95 points to 8,116.83, a gain of 1.8%.
The Dow stands 1.9% shy of its record closing peak at 27,359.16, hit July 15, while the S&P 500 is about 1.4% shy of its all-time closing high set July 26 at 3,025.86, and the Nasdaq stands 2.4% from its July 26 record at 8,330.21.
Read: History says the stock market’s volatile August paves the way for more losses in September[4]
What’s driving the market?
Echoing his speech two weeks ago in Jackson Hole, Wyoming, Powell said[5] he is “not forecasting or expecting a recession” though he sees “significant” downside risks that the central bank will monitor.
Powell’s remarks—the last any Fed official will make due to a media blackout period in the run-up to the Fed’s Sept. 17-18 meeting—come after the Labor Department said the U.S. economy added 130,000 jobs in August[6], below the 173,000 expected by economists polled by MarketWatch and down from the 159,000 jobs added in July.
The unemployment rate remained steady at 3.7%, while average hourly earnings rose 0.4% month-over-month and 3.2% year-over-year. The private sector added only 96,000 jobs, as federal government hiring, mostly temporary Census-related employment, added 28,000 jobs.
Still, Powell described the labor market in his comments in Switzerland as healthy.
Some market analysts...