U.S. stocks ended a volatile week on a mixed note on Friday, with technology shares bouncing back from Thursday’s sharp AI-driven rout while the Dow Jones Industrial Average slipped. A much stronger-than-expected October jobs report pushed Treasury yields higher and kept investors focused on the possibility that the Federal Reserve raises interest rates in December. Even with Friday’s rebound, the Nasdaq remained more than 11% below its October record high.
What Moved Markets
The Dow Jones Industrial Average fell 236.79 points, or 0.46%, to close at 51,286.27. The S&P 500 gained 23.19 points, or 0.32%, to finish at 7,376.92. The Nasdaq Composite rose 1.09% to close near 24,580, recovering part of Thursday’s steep decline, when it fell about 5.5%.
The Labor Department reported that employers added 165,000 jobs in October, far above the roughly 60,000 to 70,000 economists had expected, and the unemployment rate came in at 4.1%. Average hourly earnings rose 0.4% for the month. Normally strong hiring is good news, but with inflation still elevated, it fueled expectations that the Fed may keep policy tight. Futures markets now show better than 65% odds of a rate hike at the December 9 meeting, and the 10-year Treasury yield hovered near 4.86%.
Thursday’s selloff was tied to worries that Democratic gains in this week’s midterm elections, along with political pushback against data centers, could slow the AI building boom. On Friday, some analysts called that reaction overdone, and chip stocks led the bounce. Investors in Asia were less lucky, with South Korea’s Kospi dropping more than 6% and Japan’s Nikkei sliding into a bear market, which means a decline of 20% or more from a recent peak.
Notable Movers
Airbnb (ABNB) jumped about 12% after reporting third-quarter revenue of $4.9 billion, raising its growth outlook and announcing a buyback of up to $12 billion. Cloudflare (NET) rose about 11% after revenue climbed 39%, its fastest growth in nearly four years.
Chipmakers rebounded after Thursday’s rout. Advanced Micro Devices (AMD) gained about 11%, Intel (INTC) added about 9%, and Nvidia (NVDA) rose about 4%. Lam Research (LRCX) climbed about 9% after approving a $25 billion share buyback.
On the downside, DraftKings (DKNG) fell about 21% after posting a wider-than-expected quarterly loss and giving a cautious profit outlook. Axon Enterprise (AXON) dropped about 17% after lowering its full-year outlook, and Atlassian (TEAM) lost about 14% as investors worried about slowing growth next year.
Looking Ahead
The next big test arrives on Tuesday, November 10, when the October Consumer Price Index is due. Because rate-hike odds are already elevated, a hotter-than-expected inflation reading could add pressure to stocks, while a softer one might ease some of the worry. Investors will also watch for further developments on AI policy after the midterms, the next batch of corporate earnings, and updates on the situation in the Middle East. After a week this turbulent, expect swings to continue.