Markets Rise Ahead of Jobs Report and Long Weekend

U.S. equities rallied back from earlier losses and ended the shortened trading week higher. Markets fell initially on worries a softening labor market may be signaling a recession ahead. Two reports this week, one on private sector hiring and another on layoff announcements, pointed to a pullback in the spike in employment that came following the COVID-19 economic slump. In addition, tomorrow’s nonfarm payroll data is expected to show the smallest monthly increase in more than two years.

The Dow rose fractionally on the day, while the S&P 500 and Nasdaq posted larger gains. For the week, the Dow added 0.6%, but the S&P 500 and Nasdaq were down.

It was a positive session for struggling regional banks. Shares of First Republic Bank (FRC), Comerica (CMA), and KeyCorp (KEY) were among the winners. Shares of a large bank, Wells Fargo (WFC), jumped on an upgrade from Raymond James. Several analysts gave upgrades to FedEx after the package delivery giant explained its plans to improve profitability, and its shares rose. 

Alphabet (GOOGL) CEO Sundar Pichai said the tech firm would incorporate chat artificial intelligence (AI) in its Google search engine, and shares advanced. Microsoft (MSFT) shares gained after the Treasury Department announced a settlement over allegations the software maker violated U.S. sanctions.

Mosaic Downgrade

Mosaic Company (MOS) was the worst-performing stock in the S&P 500 after JPMorgan Chase downgraded the shares and reduced their price target. Costco Wholesale Corporation (COST) shares tumbled as the biggest warehouse retailer reported same-store sales declined. Shares of Caterpillar (CAT) and Deere & Company (DE) slid for a third straight day on demand concerns.

Oil futures were flat. Gold futures fell. The yield on the 10-year Treasury note advanced. The U.S. dollar gained on the pound and yen, but lost ground to the euro. Most major cryptocurrencies traded lower.