- US stocks closed mixed to finish off the week as investors mulled a weak August jobs report.
- The US added 235,000 payrolls in August, badly missing the median estimate of 733,000.
- Some strategists believe the report means the Fed will delay it’s timeline for tapering asset purchases.
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US stocks closed mixed to finish off the week as investors mulled how the worse-than-expected jobs report will affect the Fed’s timeline for reducing its stimulus measures.
The US added 235,000 payrolls in August, badly missing the median estimate of 733,000 added jobs. Meanwhile the unemployment rate fell to 5.2% from 5.4%, matching estimates. The month demonstrated the influence the coronavirus Delta variant had on the labor market recovery.
Now in focus is whether the report will affect when the Federal Reserve begins to scale back its bond-buying program.
“We think that today’s report should give the doves on the Federal Reserve’s board, essentially where we think the Chair resides today, some fodder for postponing a tapering of the QE asset purchase program, though we think this would be a mistake,” said Rick Rieder, BlackRock’s CIO of global fixed income and head of global allocation investment team.
Here’s where US indexes stood at the 4 p.m. ET close on Friday:
- S&P 500: 4,535.43, down 0.03%
- Dow Jones industrial average: 35,369.09, down 0.21% (74.73 points)
- Nasdaq composite: 15,363.52, up 0.21%
“Friday’s weaker-than-expected jobs puts less pressure on the Fed to taper its stimulus, which is likely to provide a short-term boost for stocks. The stock market loves stimulus and any indication that the Fed will remain fully accommodative is good news for investors,” said Jay Pestrichelli, CEO of investment firm ZEGA Financial.
Mobile brokerage app Robinhood said a potential SEC ban of payment for order flow would be “draconian” in an interview with Barron’s. SEC Chairman Gary Gensler told Barron’s last week that a PFOF ban was under consideration, which sent shares of Robinhood down 7% in one day.
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Gold climbed 1.13%, to $US1,831 ($AU2,475) per ounce.