Stocks close higher after March jobs report stokes choppy trading session

U.S. stocks closed higher Friday to cap a choppy first trading day of April as investors saw a closely-watched recession indicator in the bond market briefly flash red and mulled strong labor market data out of Washington that reaffirmed expectations for more hawkish monetary tightening plans by the Federal Reserve.

The S&P 500 rebounded into the close to rise 0.3%, and the Dow Jones Industrial Average jumped 150 points after both benchmarks struggled for direction during intraday trading. The Nasdaq Composite edged 0.3% higher, to mark a third week of gains for the tech-heavy index and the S&P 500. Friday’s moves come after Wall Street capped its worst quarter since the start of 2020.

A key part of the part of the U.S. Treasury yield curve briefly inverted Friday morning. The spread, or difference, between the 2-year and 10-year Treasury note yields narrowed and inflected for the third time this week. The phenomenon has a history of predicting a recession, with each of the last eight recessions dating back to 1969 preceded by a yield curve inversion. On Friday, the yield on the 10-year U.S. Treasury bond ended the day at 2.38%, 6 basis points below the 2-year U.S. Treasury yield of 2.44%.

Investors also digested the Labor Department’s monthly jobs report, the most up-to-date snapshot of the strength in hiring across the U.S. economy. Employers added 431,000 jobs in March, below Bloomberg consensus economist estimates of a 490,000 rise in non-farm payrolls. The latest figure reflected a slowdown from February’s 678,000 gain but still marked an increase well above pre-pandemic trends and underscored the likelihood Fed policymakers will raise interest rates more aggressively in coming months than initially expected.

Meanwhile, West Texas Intermediate (WTI) crude oil fell $14 to dip below $100 per barrel in its biggest weekly dollar loss since 2011. U.S.-allied countries in the International Energy Agency (IEA) on Friday agreed to their second coordinated deployment of oil stockpiles in a month to calm Russia-Ukraine war-roiled energy markets, one day after President Biden unveiled plans for the largest ever release from the U.S. Strategic Petroleum Reserve. The U.S. is expected to deploy 1 million barrels of oil a day from its emergency supply for the next six months starting.

Stocks kicked off April higher after the S&P 500 and Dow each dropped more than 4.5% for the first three months of 2022, closing out their worst quarters — and first quarterly declines — since Q1 2020. The Nasdaq Composite saw the biggest loss, shedding 9.1% over the past three-month period as investors rotated away from the technology and growth stocks that had led the market higher last year.

Despite day-to-day choppiness, stocks staged a solid comeback in the second half of March as the S&P rallied to climb more than 10% off its year-to-date low. Market-watchers have attributed the resurgence to optimism around the possibility of a peace negotiation between Russia and Ukraine, and to investors adjusting to the Fed’s liftoff on interest rates. However, LPL Financial points out that corporate profits may be another component driving the latest rebound.

Even in the face of war in Eastern Europe and decades-high inflation, earnings have been holding up, and estimates for S&P 500 Index earnings per share over the next four quarters are higher in March. Although not by much at 1.5%, the positive forecast is significant under the circumstances – particularly compared to how other countries have fared. Inflation is driving the more sizable corporate profits as companies enjoy more pricing power as they pass along higher costs to customers.

“On the back of energy independence, the trajectory of U.S. corporate profits has been unaffected by rising energy costs and high inflation so far,” LPL Financial equity strategist Jeffrey Buchbinder noted, adding that conversely, earnings expectations in international markets have fallen in March. “The U.S. profit outlook is the envy of the world right now.”

Also on the companies front, meme-stock favorite GameStop revealed in a form 8-K filed with the SEC after the bell Thursday that the video-game retailer will seek approval for a stock split at its upcoming shareholder meeting. GME is following a growing list of major companies — Alphabet, Amazon, Tesla — it what could be the “summer of stock splits.” Stock splits are a corporate action taken to improve trading liquidity and make shares more affordable without impacting market capitalization. GME was up 6% to about $176.43 as if 11:55 a.m. ET during intraday trading Friday.

April has historically been a strong month for stocks, and has in fact produced a positive return for the S&P 500 in 15 of the last 16 years, according to LPL Financial’s Ryan Detrick. This time, however, stocks are facing a variety of headwinds that may upend this historically positive seasonality.

Namely, a confluence of concerns around the geopolitical and macroeconomic backdrop contributed to stocks’ worst quarterly performance in two years, and have yet to be fully resolved. Geopolitical risks have been elevated since Russia’s invasion of Ukraine in late February, raising the specter of further snarls to global supply chains that have already been struggling to recover from pandemic-era disruptions. A broad-based spike in prices, and in oil and energy prices especially, has further stoked concerns over the resilience of the consumer — the key driver of the domestic economy — going forward. And the Federal Reserve has begun a protracted process of raising interest rates and tightening financial conditions in a market that had grown accustomed to easy monetary policy since 2020.

“I think investors are very happy that the quarter is over. It was a tough one. Obviously inflation was bad all the way until … the end of the quarter,” Robert Cantwell, Upholdings portfolio manager, told Yahoo Finance Live on Thursday. “And in all likelihood, the next four to six weeks, it’s likely going to continue to be bad news because inflation is persistent, and we’re still comping record growth rates from the first four months of last year.”

“That said, as you get to the second half of next quarter, you could see a scenario where growth rates start accelerating again while inflation tempers, and that has the potential to bring a lot of the bulls back into the market,” he added.

4:00 p.m. ET: Stocks bounce back after chopping intraday trading

Here’s how stocks ended the first trading day of April:

  • S&P 500 (^GSPC): +15.40 (+0.34%) to 4,545.81

  • Dow (^DJI): +139.85 (+0.40%) to 34,818.20

  • Nasdaq (^IXIC): +40.98 (+0.29%) to 14,261.50

  • Crude (CL=F): -$0.71 (-0.71%) to $99.57 a barrel

  • Gold (GC=F): -$26.90 (-1.38%) to $1,922.30 per ounce

  • 10-year Treasury (^TNX): +5 bps to yield 2.3770%

12:42 a.m. ET: S&P 500 on pace for weekly loss after erasing earlier gains

Here were the main moves in markets as of 12:42 p.m. ET:

  • S&P 500 (^GSPC): -15.47 (-0.34%) to 4,514.94

  • Dow (^DJI): -80.99 (-0.23%) to 34,597.36

  • Nasdaq (^IXIC): -62.95 (-0.44%) to 14,157.57

  • Crude (CL=F): -$1.19 (-1.19%) to $99.09 a barrel

  • Gold (GC=F): -$26.50 (-1.36%) to $1,927.50 per ounce

  • 10-year Treasury (^TNX): +5.7 bps to yield 2.3840%

12:28 a.m. ET: Amazon workers in New York win first US union in company’s history

Employees at Amazon’s (AMZN) warehouse on Staten Island narrowly won a historic union election on Friday to establish the first U.S. union in the company’s nearly 30-year history.

As of early Friday afternoon, the union was poised for victory with a margin of nearly 500 votes. The National Labor Relations board said that the union and Amazon had challenged 66 ballots, suggesting that the margin of victory would exceed the number of contested ballots and conclude the election without further dispute.

“A win is potentially world-changing,” Erik Loomis, a labor historian and professor at the University of Rhode Island, told Yahoo Finance prior to the vote. “It would set a precedent that there is a big demand out there to organize this new economy.”

The move also stands to intensify a nationwide surge of organizing across major companies like Starbucks (SBUX) and Disney (DIS).

Amazon JFK8 distribution center union organizer Jason Anthony speaks to the press about preliminary results regarding the vote to unionize, outside the NLRB offices in Brooklyn, New York City, U.S., April 1, 2022. REUTERS/Brendan McDermid

12:19 a.m. ET: US allies to follow suit on Biden’s oil-stock release

U.S.-allied countries in the International Energy Agency (IEA) agreed to their second coordinated deployment of oil stockpiles in a month to calm Russia-Ukraine war-roiled energy markets, one day after President Biden unveiled plans for the largest ever release from the U.S. Strategic Petroleum Reserve.

The timing and volumes of the releases from each country will be decided at a later date, Japan’s industry ministry said.

A month ago, IEA members agreed on a 61.7-million barrel release, with 30 million coming from the U.S. and 2.2 million from the U.K, though the move had minimal impact on prices as turmoil in Eastern Europe threatened to trigger one of the biggest oil-supply disruptions in history.

“This is a moment of consequence and peril for the world, and pain at the pump for American families,” Biden said at an event at the White House Thursday.

“Our prices are rising because of Russian President Vladimir Putin’s actions,” he said. There isn’t enough supply, and the bottom line is if we want lower gas prices we need to have more oil supply right now.”

11:18 a.m. ET: General Motors stock falls after carmaker reports decline in Q1 deliveries

Shares of General Motors (GM) dipped after the automaker reported its U.S. deliveries fell 20.1% in the first quarter to 512,846, dragged down by Buick deliveries which more than halved.

GM was down 1.5% to $43.10 per share as of 11:16 a.m. ET.

“Supply chain disruptions are not fully behind us, but we expect to continue outperforming 2021 production levels, especially in the second half of the year,” the carmaker said Friday.

General Motors also indicated the company expects inventory to remain “relatively low throughout the year due to high demand.”

11:02 a.m. ET: JPMorgan ditches Apple, Qualcomm from top picks list

JPMorgan dropped iPhone giant Apple (AAPL) and chipmaker Qualcomm (QCOM) from the brokerage’s “Analyst Focus List,” indicating slowing demand for smartphones is expected to put a dent in the companies’ growth.

The move comes as analysts warned that another wave of COVID lockdowns in China and higher prices on goods are likely to weigh on demand this year.

“There has been understandably a lot of noise around demand weakness across global tech, but we believe the macro weakness seeping through the sector will impact the consumer end-markets more materially,” JPMorgan analyst Samik Chatterjee said.

Apple already reportedly has plans to limit production on some iPhones and its AirPods due to a decrease in demand.

Shares of the tech giant were down 0.5% as of 11:01 a.m. ET to $173.75 a piece. Qualcomm fell 3.7% to $147.12 per share.

9:30 a.m. ET: Stocks open higher following March jobs report

Here were the main moves in markets at Friday’s open:

  • S&P 500 (^GSPC): +12.54 (+0.28%) to 4,542.95

  • Dow (^DJI): +74.62 (+0.22%) to 34,752.97

  • Nasdaq (^IXIC): +70.78 (+0.50%) to 14,291.30

  • Crude (CL=F): -$1.01 (-1.01%) to $99.27 a barrel

  • Gold (GC=F): -$23.10 (-1.18%) to $1,930.90 per ounce

  • 10-year Treasury (^TNX): +9.9 bps to yield 2.4260%

8:30 a.m. ET: Payrolls rise by 431,000 as unemployment rate falls to 3.6%

The U.S. economy notched another sizable payroll gain in March as the labor market extending its strong and speedy recovery to bring employment back to pre-pandemic levels. U.S. employers added 431,000 jobs, lower than the expected 490,000 jobs.

Meanwhile, the unemployment rate dropped a more-than-expected two-tenths of one percent, edging closer to the historic low of 3.5% seen in February 2020, Bankrate senior economic analyst Mark Hamrick noted, though pointing out that the labor force participation rate remains 1 percentage point below its pre-pandemic level.

The labor force participation ticked up slightly to 62.4% after an unexpected jump to 62.3% in last month’s data signaled more individuals were returning to look for work or be placed in jobs after being sidelined by COVID-19.

“Beyond the positive March snapshot, the outlook for the next year is for further moderation in jobs creation,” Hamrick said in a note. “Emboldened by exorbitantly high inflation, a hawkish Federal Reserve feels compelled to slam on the brakes. It is hard to imagine how tightening doesn’t ultimately affect the job market.”

7:14 a.m. ET: Futures charge higher to kick off April trading

Here were the main moves in futures trading ahead of the open Friday:

  • S&P 500 futures (ES=F): +22.00 points (+0.49%) to 4,552.75

  • Dow futures (YM=F): +172.00 points (+0.50%) to 34,790.00

  • Nasdaq futures (NQ=F): +80.00points (+0.45%) to 14,948.75

  • Crude (CL=F): +$0.14 (+0.14%) to $100.14 a barrel

  • Gold (GC=F): -$21.90 (-1.12%) to $1,932.10 per ounce

  • 10-year Treasury (^TNX): 0.00 bps to yield 2.3270%

6:24 p.m. ET Thursday: GameStop surges to 4-month high after filing stock split plans

GameStop (GME) shares rallied in extended trading following an announcement after the bell indicating the video-game retailer plans to seek approval for a stock split.

The meme-stock favorite rallied as much as 20% in extended trading to a 4-month high of more than $200 per share following the news.

The company said in an 8-K SEC filing it plans to request stockholder approval at its upcoming annual shareholder meeting to increase the number of authorized Class A shares from 300 million to 1 billion in order to implement the split through a dividend.

With GME following suit on a growing list of companies recently reporting similar plans – Alphabet, Amazon, Tesla – it could be the “summer of stock splits.” Stock splits are a corporate action taken to improve trading liquidity and make shares more affordable, without impacting market capitalization.

6:10 p.m. ET Thursday: Futures tick up slightly ahead of first April trading day

Here’s where the major stock index futures opened heading into the overnight session Thursday:

  • S&P 500 futures (ES=F): +12.25 points (+0.27%) to 4,543.00

  • Dow futures (YM=F): +96.00 points (+0.28%) to 34,714.00

  • Nasdaq futures (NQ=F): +49.75 points (+0.33%) to 14,918.50

  • Crude (CL=F): +$1.04 (+1.04%) to $101.32 a barrel

  • Gold (GC=F): -$12.20 (-0.62%) to $1,941.80 per ounce

  • 10-year Treasury (^TNX): -3.1 bps to yield 2.3270%

NEW YORK, NEW YORK - MARCH 28: Traders work on the floor of the New York Stock Exchange (NYSE) on March 28, 2022 in New York City. Following a positive week for stocks, the Dow Industrial Average was down over 100 points in morning trading. (Photo by Spencer Platt/Getty Images)

NEW YORK, NEW YORK – MARCH 28: Traders work on the floor of the New York Stock Exchange (NYSE) on March 28, 2022 in New York City. Following a positive week for stocks, the Dow Industrial Average was down over 100 points in morning trading. (Photo by Spencer Platt/Getty Images)

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter.

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter.

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Christopher Lewis

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