Dow futures gain more than 300 points after jobs report shows weaker-than-expected wage gains

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City on November 10, 2022.

Brendan McDermidt | Reuters

U.S. stock futures rose on Friday after a December jobs report showed employment was slightly stronger, wage gains were less than expected and some signs of improvement amid interest rate hikes by the Federal Reserve to control inflation.

Dow Jones industrial average futures rose 311 points, or 1%. S&P 500 futures rose 0.87%, while Nasdaq-100 futures rose 0.72%.

The December non-farm payrolls report showed The US economy added 223,000 jobs Last month, Dow Jones added 200,000 jobs, slightly more than economists had expected. In addition, wages grew more slowly than expected, rising 0.3% in the month when economists expected 0.4%.

“All investors are concerned about is that the data suggests that inflation is moving toward the Fed’s target,” said Michael Aron, chief investment strategist at State Street Global Advisors. “That’s what investors are paying attention to and average hourly earnings mean inflation continues to decline. They’re excited about that.”

The Dow fell more than 300 points on Thursday after the release of a stronger-than-expected ADP private payrolls report. This raised concerns for higher Federal Reserve rates, which in turn fueled fears that the US could soon fall into recession.

“I let that in my thinking By the end of the year we may be in recessionAnd that slowdown will be brought about by Fed tightening, QT, quantitative tightening, a strong dollar or oil prices,” said Leon Cooperman of the Omega Family Office on CNBC. “Closing Hour: Overtime” Thursday.

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“If we had a recession, the market would have finished its decline, say, 35% below its peak, so you’d have the low 3,000s,” Cooperman added.

Shares are 2023 was headed for loss in the first trading week. As of Thursday’s close, the Dow was down 0.66% year-to-date, heading into its fourth week in five. Meanwhile, the S&P 500 and Nasdaq are both on pace for fifth straight weekly losses, down 0.82% and 1.54%, respectively.

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