Stocks pulled back during Friday afternoon trading after a strong rally led by big tech names. The uptick in the unemployment rate in the February jobs report boosted investor confidence in a potential rate cut by the Federal Reserve following its June meeting. The S&P 500 trended near the flatline after reaching another record close, while the Dow Jones Industrial Average rose by close to 0.3%. However, the tech-heavy Nasdaq Composite experienced a 0.3% decline after a significant gain the day before.
The non-farm payrolls report for February exceeded expectations with 275,000 jobs added, although the unemployment rate increased to 3.9%. Chair Jerome Powell’s comments about potentially cutting borrowing costs caused a stir in the market, while policymakers from the European Central Bank and the Bank of Japan hinted at supporting rate cuts as well. On the corporate front, Costco shares dropped 7% due to a quarterly sales miss, and Broadcom’s revenue beat and AI-linked chip sales forecast failed to impress investors, leading to a over 6% decline in the stock price.
In the commodities market, gold futures continued to rally, with spot gold eyeing its biggest weekly jump in five months amid expectations for a mid-year Fed rate cut. The surge in Bitcoin, reaching an all-time high of over $70,000 before dropping back down, highlighted the volatility in the cryptocurrency market. Stocks are set to close the week on a positive note after the jobs report, with rising optimism for a potential interest rate cut by the Federal Reserve.
