Key Highlights

  • Apple ranked in the upper tier of the 30-stock Dow average on Friday, trailing names such as Nvidia, Amazon, Caterpillar and Goldman Sachs, with no company-specific news found for the session.
  • The September jobs report showed just 29,000 jobs added against roughly 84,000 expected, with average hourly Earnings marking the slowest annual wage gain since May 2021.
  • Nvidia was the Dow's best performer and hit a record high after Morgan Stanley named it its top semiconductor pick, while the Nasdaq-100 notched a record close of 30,807.93.
  • Market breadth stayed narrow, with only a small minority of S&P 500 stocks trading above their 50-day moving averages, and the Dow still finished the week down 651.66 points.

Apple (NASDAQ:AAPL) climbed with the rest of Big Tech on Friday as a feeble jobs report knocked back fears of another Federal Reserve rate hike. Shares finished Friday, October 2, in the green, riding a broad rebound in the largest technology stocks that helped the Dow Jones Industrial Average add 250.40 points to close at 51,176.96. No company-specific news was found for Apple during the session. The iPhone maker simply moved with the crowd, and on this day the crowd was heading firmly into mega-cap tech. Eighteen of the Dow's 30 members ended higher.

A Weak Jobs Report Flipped the Script

The trigger for Friday's tech bid came at 8:30 a.m. Eastern, when the Labor Department reported that the US economy added just 29,000 jobs in September, far short of the roughly 84,000 economists had pencilled in. Revisions made the picture gloomier still: July was cut to a loss of 10,000 jobs and August was trimmed to 133,000, wiping 60,000 jobs off the earlier tally.

The Unemployment rate ticked up and wage growth cooled, with average hourly earnings at $37.81 marking the slowest annual gain since May 2021.

For a market that had been bracing for more tightening, that was welcome news. The Federal Reserve under Chair Kevin Warsh raised rates on September 16, its first hike since 2023, after the oil shock from the war with Iran pushed Inflation higher again. After Friday's data, traders sharply cut their bets on another increase at the October 27-28 meeting, though those bets partly recovered into the close.

Big Tech Did the Heavy Lifting

Lower hike odds tend to favour companies whose value rests on long-term growth, and the market's biggest names responded. Nvidia was the best performer in the Dow and hit a record high during the session after Morgan Stanley named it its top semiconductor pick. Amazon rose after a report said it was in talks to move about $8 billion of Nvidia chips into a special-purpose vehicle and Lease them back.

The tech-heavy Nasdaq-100 notched a record close at 30,807.93, up 306.37 points, while the broader Nasdaq Composite touched an all-time high during the day but closed short of a record. The S&P 500 gained 56.27 points to 7,722.72.

Consumer discretionary and information technology were the two strongest of the 11 S&P 500 sectors, and 10 of the 11 finished higher.

Not a Straight Line

The rally had limits. Treasury yields fell right after the jobs report but reversed to close higher, with the 10-year yield ending near its highest level since 2002. Higher long-term yields can weigh on richly valued growth stocks, and that tug-of-war kept gains in check.

Breadth was also thin. Only a small minority of S&P 500 stocks were trading above their 50-day moving averages, a sign that a handful of giants are carrying the market. CNN's Fear & Greed index edged up to 31 from 28 but stayed in Fear territory.

For the week, the Dow still finished lower, down 651.66 points, even as the Nasdaq-100 posted a weekly gain.

The Fed Meeting Is the Next Big Test

The Fed's October 27-28 meeting is the next big test for rate-sensitive tech. Before then, the third-quarter earnings season begins: PepsiCo reports on October 8, Delta on October 9, and the big banks on October 13 and 14. Analysts expect strong double-digit earnings growth for S&P 500 companies, and estimates were raised during the quarter rather than cut, unlike the usual pattern. Investors will also keep an eye on the 10-year yield and oil prices, both of which have shaped the Fed's thinking this year.