Dow falls 600 points as rates pop in September jobs report

Stocks fell on Friday as traders assessed the September jobs report, which showed the unemployment rate continued to decline and prompted an increase in interest rates.

The Dow Jones industrial average fell 603 points, or 2%. The S&P 500 lost 2.6%, while the Nasdaq Composite fell 3.6%.

Friday’s job numbers showed The US economy added 263,000 jobs in September, just below the Dow Jones estimate of 275,000. However, the unemployment rate was 3.5%, up from 3.7% in the previous month, a sign that the jobs picture continues to strengthen despite the Federal Reserve’s efforts to slow the economy with rate hikes to curb inflation.

“Despite the data coming in as expected, markets are jittery because of what the fall in the unemployment rate means for the central bank,” said Peter Bookvar, chief investment officer at Bleakley Financial. “Combined with the low level of initial jobless claims, the pace of firings will remain calm, and this certainly has the Fed all excited about continuing to raise its occupancy rate.”

A falling unemployment rate prompted a rise in rates, which in turn weighed on futures. The 2-year Treasury yield rose 5 basis points to 4.302%. (1 basis point equals 0.01%.)

Shares of advanced microdevices fell after the chipmaker Its third-quarter earnings warned Less than expected. Levi Strauss shares slipped following a cut to its guidance.

Friday’s losses capped gains in what started as a big rally week for stocks. The major averages are still on pace to end the week higher, but have given back most of the gains from the rally that started the week. The Dow is headed for a 2% weekly gain, while the S&P is on track to end the week 1.7% higher. The Nasdaq is on pace to rise 1%.

Wells Fargo equity analyst Christopher Harvey said, “A lot of the conclusion we’ve talked to is that it’s not just that the Fed won’t help the markets, but that their efforts at price stability will continue until something breaks in the capital markets. Bonds.” .”