U.S. stocks opened higher on Friday, with the Dow hitting the 22,000 mark, after data showed job growth slowed more than expected in August, which could make the central bank cautious about raising interest rates again this year,Reuters reports.
The U.S. economy added 156,000 jobs in August, below the 180,000 expected by economists polled by Reuters. The unemployment rate edged up to 4.4 percent from 4.3 percent, while average hourly earnings increased 0.1 percent after rising 0.3 percent in July.
The sluggish wage growth follows data from Thursday that showed annual inflation in July advanced at its slowest pace in more than 1-1/2 years. U.S. short-term interest rate futures rose slightly on Friday, reflecting expectations that the Fed will not raise interest rates before mid-2018.
“It’s a little bit of a disappointment,” said Scott Anderson, chief economist at Bank of the West. “The labor market is doing fine but not quite as strong as people thought going into this number … this probably raises the odds the Fed doesn’t go ahead with a December rate hike.”
However, August’s moderation in employment growth, likely reflects a seasonal quirk and is far more than the 75,000 to 100,000 jobs per month needed to keep up with growth in the working-age population.
At 9:38 a.m. ET (1338 GMT), the Dow Jones Industrial Average .DJI was up 38.91 points, or 0.18 percent, at 21,987.01, the S&P 500 .SPX was up 4.81 points, or 0.19 percent, at 2,476.46. The Nasdaq Composite .IXIC was up 12.29 points, or 0.19 percent, at 6,440.95.
All three major indexes are on track to post gains for the second straight week, though trading volume is expected to remain muted as investors head into the Labor Day weekend. Eight of the 11 major sectors were higher, with the consumer discretionary index’s .SPLRCD 0.37 percent rise leading the advancers.
Ford’s (F.N) shares were up 2.7 percent after the automaker’s August sales fell the least in three months, while General Motors (GM.N) rose 1.9 percent after its sales rose. Wall Street closed higher on Thursday as investors took cautious hope from Washington’s latest promises for long-awaited details of a tax reform plan.
U.S. Treasury Secretary Steven Mnuchin said President Donald Trump’s administration has a detailed plan on tax reform and is on track to implement it by year-end. Oil prices fell in the wake of Harvey, which has killed more than 40 people and brought record flooding to the oil heartland of Texas, paralyzing a quarter of the U.S. refining industry. [O/R]
Shares of Palo Alto Networks (PANW.N) jumped 7.5 percent in premarket trading after the cybersecurity firm reported profit and revenue above expectations. Ambarella (AMBA.O) was down 20.3 percent after a series of price target cuts following a tepid forecast.
Canadian yoga and leisure apparel maker Lululemon Athletica (LULU.O) rose 5.9 percent on earnings beat. Advancing issues outnumbered decliners on the NYSE by 1,715 to 826. On the Nasdaq, 1,365 issues rose and 819 fell.