US stocks end mixed despite stronger-than-expected jobs report

4:05pm: US tech stocks end in the red US stocks ended mixed despite a stronger-than-expected jobs report.  However, the Dow Jones Industrial Average and the S&P 500 hit record closing highs as they ended the day in the green.  The Labor Department said the US economy added 943,000 jobs in July, as economists expected 845,000. On the day, the Dow increase 144 points, or 0.41%, to 35,209 and the S&P 500 rose 0.17% to 4,436  But the tech-heavy Nasdaq fell 0.48% to 14,823. 12:10pm: Positive July jobs data propels US stocks higher At midday the Dow Jones Industrial Average continued to make gains, adding 126 points to sit at 35,190. The upbeat July employment numbers allowed the index to retain its gains despite concern that increases in American Delta variant cases will weigh on economic recovery this month. The S&P 500 also moved 3.47 points higher by lunch holding in the 4,432 range. But the tech-laden Nasdaq Composite stayed dull, down 0.4%. With the US unemployment rate falling to 5.4%, surpassing the forecasted 5.7% market watchers are speculating the Federal Reserve will begin to wind down its $120 billion monthly bond-buying program. Ending the initiative which was meant to bolster the economy through the pandemic, could signal a long-term, substantial recovery.  However, after dipping below 100,000 new daily infections in mid-February, COVID-19 cases in the country have been on a steady rise with 127,108 new cases reported yesterday (August 5).   9.55am: Dow in demand US blue-chips pushed higher in early trade on Friday after the latest US jobs data proved stronger thamn expected alleviating fears over the pace of economic recovery from the coronavirus (COVID-19) pandemic. After 15 minutes of trading, the Dow Jones Industrial Average was up 122 points, or 0.4% at 35,187, while the broader S&P 500 index added 0.1%, but the tech-laden Nasdaq Composite shed 0.3%. US non-farm payolls rose by 943,000 in July, above the 870,000 forecast, with the unemployment rate falling to 5.4% last month, down from 5.9% in June and more than the predicted drop to 5.7%, the Labor Department said on Friday. Caleb Thibodeau, Associate at Validus Risk Management, said: “In the last Fed meeting, we heard Powell brushing off labor market sluggishness, indicating the employment recovery was on a strong, very robust path that will catch-up to inflation – this was definitely the feeling from today’s change in nonfarm payrolls and drop in the unemployment rate. “Looking ahead, the market may struggle to balance competing forces. On one hand this release is certainly a sign of good and continued economic growth, though it also much-increases the probability of the Fed tapering their $120bn monthly asset purchases. “With the inflation box considered ticked, strong labour market data releases such as this contribute toward ticking the second box of maximal labour market participation. Once progress is identified toward this second goal in the Fed’s eyes, it will most likely prepare for tapering and has already prepared the market for this – perhaps by the end of the year." Thibodeau added: “This change in payrolls fits in with a larger labour market recovery story playing out, seen from higher services PMI earlier this week and a high amount of job openings. While it is unusual to have unemployment numbers at their current levels in tandem with high job openings, transitional labour market frictions appear to be reducing along with COVID restrictions. “Importantly, Powell was very deliberate in specifying there is no quantitative threshold which the Fed is looking for on jobs reports, leaving the door open for what defines ‘substantial progress’. The market seems to be in agreement today that this release will almost certainly fit the definition of further progress.” 8.40am: Jobs boost US stock futures ticked higher after non-farm payolls rose by 943,000 in July, more than the 870,000 forecast, with the unemployment rate falling to 5.4% last month, down from 5.9% in June and more than the predicted drop to 5.7%, the Labor Department said on Friday. In reaction to the data, Robert Alster, CIO at investment management firm Close Brothers Asset Management commented: “Payrolls continue to paint a positive picture of the US jobs market, but the Fed will be keeping a close eye on the detail before making any decisions. Companies are still struggling to hire, with job gains constrained by either not enough workers, the wrong workers in the wrong place, or the wrong jobs at the wrong salaries. Teen workers currently make up a higher proportion of the labour market than usual, and Powell’s dashboard reveals an uneven recovery in terms of diversity and inclusion. “What’s more, much of the unemployment data coming out of the US, especially initial jobless claims, has been distorted by systemic changes to collection and reporting across different states throughout the pandemic. This has led to incomplete or inaccurate readings, and will take some time to fix. Until we have a clearer reading of the landscape, both in terms of quality of data and some post-Covid clarity, it is unlikely the Fed will be in a rush to signal a change in policy.” 7.40am: Caution rules ahead of data US stocks look set for a fairly flat open on Friday reflecting caution ahead of a July jobs report that will give insights into the pace of the economic rebound from the coronavirus (COVID-19) pandemic. Futures for the Dow Jones Industrial Average ticked up less than 0.1%, albeit following a 0.8% jump on Thursday. The broader S&P 500 futures were roughly flat, while technology-focused Nasdaq-100 futures fell 0.1%. US job growth is expected to have remained robust in July amid shifts in seasonal employment at schools caused by the pandemic, which could mask some softening in underlying labor market conditions as the boost from fiscal stimulus fades. Non-farm payrolls are forecast to increase by 870,000 in July, with the unemployment rate seen falling to 5.7% from 5.9%, and average hourly earnings are seen rising 0.3% Investors were also weighing up the latest mixed set of quarterly earnings. Ahead of the opening bell in New York, shares of American International Group pushed higher after it swung to a second-quarter profit, aided by gains in its private equity investments. But Beyond Meat’s stock fell after the maker of non-meat products reported a wider quarterly loss, and Expedia (NASDAQ:EXPE) Group dropped after the travel company posted a second-quarter loss. Four other things to watch on Friday: India's top court on Friday handed Amazon.com Inc a major victory in a dispute where it sought to block its partner Future Group from selling $3.4 billion in assets to rival Reliance Industries. Rupert Murdoch’s media group News Corp (NASDAQ:NWS) returned to profit in the year to the end of June, with the owner of the Wall Street Journal and The Sun seeing revenues rise 4% to US$9.4bn from US$9.0bn the year before, while net income (post-tax profit) was positive at US$389mln compared to a loss the year before of US$1.6bn when the company took write-downs of US$1.7bn. Spaceship company Virgin Galactic said it will open ticket sales for space flights starting at $450,000 a seat, weeks after billionaire founder Richard Branson's high-profile trip to the edge of space. Procter & Gamble (NYSE:PG) Co said activist investor Nelson Peltz would step down from the company's board at the end of his term later this year.