Investing.com -- The S&P 500 rose Friday as monthly jobless claims missed expectations, stoking hopes that labor market strength may be abating and could persuade the Federal Reserve to lean less hawkish.
June payrolls miss expectations to fuel hopes of less hawkish Fed
The economy created 209,000 jobs in June, missing the 225,000 expected and a marked decrease from the 306,000 in the prior month. That marked the weakest pace of job creation since December 2020.
But average hourly earnings , or wage growth, rose 4.4% last month, topping estimates of 4.2%
While expectations for a July hike remained baked in, investors are betting that the cooling in the labor market would be enough to keep the Fed from hiking again after July.
“Today’s report supports our view that the incoming data will not meet the bar for the Fed to deliver a hike in September,” Morgan Stanley said in a note.
Energy stocks lead charge
Energy stocks were back in the driving seat, leading the broader market higher as expectations that a less hawkish Fed eased worries about a recession and the oil demand outlook.
Levi flaunts unfashionable earnings as guidance cut
Levi Strauss (NYSE: LEVI ) fell more than 8% after the denim retailer cut its annual earnings guidance after reporting quarterly results that showed a beat on earnings, but in-line sales amid a dip in wholesale revenue.
The company cut its guidance on adjusted diluted EPS for 2023 to a range of $1.10 to $1.20 from $1.30 to $1.40 and said it now expects revenue of growth of between 1.5% and 2.5% from 1.5% and 3% previously.
Pressure in U.S. wholesale is now resulting in some level of “pricing give-back in comparison to the growth achieved since pre-pandemic levels,”Goldman said after cutting its price target on the stock to $14 from $15.
Big movers: Rivian, Alibaba shine
Rivian Automotive Inc (NASDAQ: RIVN ) climbed more than 8% after Wedbush upgraded its price target on the EV maker to $30 from $25 amid “further confidence in Rivian hitting/exceeding its delivery targets heading into 2H23 and 2024 with an inflection year ahead.”
The upgrade comes just days after the company reported that it had delivered 12,640 vehicles in the second quarter, beating market estimates.
Alibaba (NYSE: BABA ), meanwhile, was up more than 8% as it moves a step closer to put the regulator spotlight in China in the rearview mirror after its affiliate Ant Group received a $984 million fine from authorities.
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.