FX.co ★ Jobs Data, Apple Earnings Contribute To Extended Rally On Wall Street

Continuing with Thursday's rally, the stocks witnessed yet another substantial positive shift during Friday's trading. The major averages all showed a considerable upward trend, led by heavy tech Nasdaq.

The major averages remained steadfastly positive, moving mostly sideways following an initial surge. The Dow leaped 450.02 points or 1.2 percent to 38,675.68, the Nasdaq rose by 315.37 points or 2.0 percent to 16,156.33, and the S&P 500 ascended by 63.59 points or 1.3 percent to 5,127.79.

Weekly, the S&P 500 surged by 0.6 percent, the Dow by 1.1 percent, and the Nasdaq by 1.4 percent. The robust rally on Wall Street was induced by the Labor Department's report that showed a much lower increase in U.S. employment in April than anticipated.

According to the Labor Department, non-farm payroll employment rose by 175,000 jobs in April, following an upward revision of 315,000 jobs in March. Economists had forecast an employment hike by 243,000 jobs, differing from the initially reported increase of 303,000 jobs for the earlier month.

The report also revealed a slight uptick in the unemployment rate to 3.9 percent in April from 3.8 percent in March, expected to remain the same. The annual rate of wage growth decelerated to 4.0 percent in April from 4.1 percent in March, matching the economists' expectation.

The data cultivated optimism about interest rate prospects in response to the Federal Reserve's monetary policy meeting held earlier during the week. According to Chris Zaccarelli, Chief Investment Officer for Independent Advisor Alliance, the softer jobs report demonstrates a relief in wage-induced inflation pressure.

Additionally, Apple's positive earnings news led to an increase in the company's stocks by 6.0 percent. The tech giant announced a $110 billion stock repurchase following their better-than-expected fiscal second quarter results.

However, according to the Institute for Supply Management, there was an unexpected contraction in U.S. service sector activity in April. The services PMI fell to 49.4 in April from 51.4 in March, with indexes below 50 indicating contraction. This showed that the sector's activity contracted for the first time since December 2022.

Among sectors, Semiconductor stocks demonstrated market-leading performances, propelling the Philadelphia Semiconductor Index by 2.4 percent. Software and computer hardware stocks alongside housing stocks also reflected considerable strength. Steel, brokerage, and retail stocks also surged, aligning with the momentum of other major sectors.

In the global realm, most Asia-Pacific stock markets trended higher on Friday, with Japan and mainland China markets closed for holidays. Hong Kong's Hang Seng Index and Australia's S&P/ASX 200 Index escalated by 1.5 percent and 0.6 percent respectively. Major European markets also experienced an upward trajectory on the day.

Despite an initial rally, the bond market saw some retreat but remained significantly positive. Consequently, the benchmark ten-year note yield, moving inversely to its price, drop by 7.1 basis points to 4.50 percent.

As we look ahead, given the U.S.'s relatively quiet economic calendar for the upcoming week following several key events, the focus might shift to the earnings reports from several major companies.