S&P 500 and Nasdaq end Friday lower after November jobs report; indexes notch weekly gains

Pro Picks: Watch all of Friday's big stock calls on CNBC
Pro Picks: Watch all of Friday's big stock calls on CNBC

Stocks cut much of their earlier losses Friday as investors looked past hotter-than-expected labor data to the upcoming Federal Reserve meeting.

The Dow Jones Industrial Average closed up just 34.87 points, or 0.1%, to 34,429.88 points after hitting a session low of more than 350 points down. The S&P 500 dipped 0.1% to 4,071.70, rebounding from an earlier loss of 1.2%. The Nasdaq Composite also made up ground to end nearly 0.2% lower at 11,461.50 points. The tech-heavy index dropped as much as 1.6% earlier in the day.

All three indexes set weekly gains, with the Nasdaq posting the largest increase at nearly 2.1%. The S&P 500 added 1.1%, and the Dow ticked up by 0.2%. Friday's close marked the first time the three major indexes notched back-to-back weekly gains since October.

Stocks dipped after labor data released Friday morning showed payrolls rose by 263,000 in November, a bigger gain than the 200,000 increase expected by economists polled by Dow Jones. Average hourly earnings also came in above expectations, jumping 0.6% compared with the prior month and 5.1% against the same month a year ago. The unemployment rate held steady at 3.7%.

The market quelled much of those losses as the trading day went on. Market observers attributed the move to investors being increasingly able to shake off concerning individual economic indicators following remarks on Wednesday from Fed Chair Jerome Powell that appeared to confirm slowing rate hikes starting as early as December.

"Just one strong labor data point is not going to be enough after Powell's speech," said Anna Han, vice president at Wells Fargo Securities. "He's confirming that we are seeing the trend that we are having an impact on inflation, so I think that sort of soothes the market and takes pressure off."

It was the final monthly employment report before the Fed's two-day meeting Dec. 13-14, in which the central bank is expected to slow to a 50 basis point interest rate hike from the 75 basis point hikes seen in recent months.

Lea la cobertura del mercado de hoy en español aquí.

S&P 500 and Nasdaq end Friday down, but all three indexes see weekly gains

The three major indexes ended the week up despite a mixed performance in Friday trading.

The Dow ended up 34.87 points, or 0.1%, to 34,429.88. It saw the smallest gain this week at 0.2%.

The Nasdaq Composite saw the reverse. It ended the day down nearly 0.2%, to 11,461.50 — making it the worst performer of the day. But it saw the largest weekly gain of about 2.1%.

The S&P 500 ended down 0.1%, to 4,071.70. The broad index gained 1.1% this week.

It was the first back-to-back weekly gain for the three indexes since October.

— Alex Harring

With less than half an hour left, indexes are poised for winning weeks

As Friday trading entered the final half hour, all three of the major averages were on track to see gains for the week.

The Nasdaq Composite was staring down the biggest win, on pace to end up nearly 2%.

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The S&P 500 came next, with the potential to close the week 1% higher.

Meanwhile, the Dow was heading toward a more modest gain of just under 0.1%. For much of the day, it was on track to end the week slightly down.

— Alex Harring

Fed must look at inflation in other areas as labor remains sticky, HSBC chief says

Friday's job data showed the labor market remained strong despite interest rate hikes. But that does not mean those hikes are not having the intended effects elsewhere, according to Jose Rasco, chief investment officer for wealth management and private banking at HSBC.

Rasco said Friday's data is yet another indicator that inflation within services is not cooling as the central bank has hoped with average hourly wages up above expectations. However, he said the Fed can look elsewhere despite its apparent focus on labor as a key indicator of the state of current inflation.

Rasco said he believes there is enough disinflation elsewhere to show the effectiveness of prior interest rate hikes. He pointed to slides in demands for goods.

"The question is, 'Has the Fed seen enough disinflation in other markets to warrant a slowing in the pace of Fed rate hikes?,'" he said. "We would argue yes."

— Alex Harring

Dow turns green as final hour of trading kicks off

The Dow was propelled into positive territory after steadily marching off an early low over the course of the trading session.

The Dow was up about 30 points around 3:05 p.m., which amounts to a gain of just under 0.1%. That's a nearly 400 point gain from the 355 point low seen in morning trading after stronger-than-expected jobs data put downward pressure on the index.

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— Alex Harring

Indexes remain down as investors enter final trading hour

The three major indexes have remained down but off day lows with just over one hour left in the trading week.

The Dow was down 31 points, a fraction of the more than 355 points lost earlier in the day. That equates to a loss of 0.1%.

The Nasdaq and S&P 500 shed 0.5% and 0.3%, respectively.

The Dow is poised to end the week at a slight loss, while the Nasdaq and S&P 500 will both likely notch modest gains.

— Alex Harring

RBC downgrades DoorDash amid slowing order growth

Slowing order growth was one factor prompting RBC Capital Markets to downgrade DoorDash.

The firm slashed its rating to sector perform from outperform, while lowering the stock's price target to $60 from $70. The new target price represents roughly 5% upside.

It comes amid a tough year for the food delivery stock, which has lost 62.2% of its share value compared with the start of 2022. It dipped 2.4% in Friday trading.

"DASH's execution & management are widely considered the class of the sector but approaching '23, we are uncomfortable with a potentially unfavorable risk/reward given likely hypersensitivity to order deceleration," analyst Brad Erickson wrote in a Thursday note.

CNBC Pro subscribers can read the full story here.

— Carmen Reinicke

Materials sector could be at the start of a long-term rally

The materials sector is on a rally that could be the start of a long-term run, according to Frank Gretz, technical strategist at Wellington Shields.

"In less than two months every stock in the group had gone from below its 50-day moving average to above that average. There is a small sample here, but all of the occurrences showed positive returns in the next 2 to 12 months," Gretz said.

The Materials Select Sector SPDR Fund is up about 0.6% on the day and is now up more than 15% over the past month.

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— Jesse Pound

November unemployment fell for Hispanic workers and Black women

The unemployment rate in the U.S. declined for Hispanic workers and Black women in November, while the overall rate held steady.

Hispanic workers saw unemployment dip to 3.9% last month, down from 4.2% in October, according to the Labor Department on Friday.

Black unemployment dropped to 5.7%, down from 5.9%. It fell more for Black women to 5.2%, from 5.8%.

More broadly, the U.S. unemployment rate remained unchanged at 3.7% in November, the same level as October, and in line with expectations.

Read the full story here.

— Sarah Min

These stocks are making the biggest midday moves

These are the stocks making the biggest moves in midday trading:

Zscaler – The cloud security company's shares dipped 11% following its quarterly earnings report, despite Zscaler posting strong results. Earnings and revenue were stronger than analysts' expectations. The company also forecast better-than-expected earnings and revenue for its fiscal second quarter and full year.

Marvell Technology – The semiconductor stock fell 4% after the company reported weaker-than-anticipated earnings and revenue for the most recent quarter. Its outlook for revenue for the fourth quarter also came in lower than analysts expected.

DoorDash – Shares of the food delivery service operator fell more than 2% following a downgrade from RBC Capital Markets. The firm cited slowing order growth, calling it "too important to ignore," and intensifying competition from Uber.

Read more here.

—Carmen Reinicke

Some S&P 500 sectors turn positive as index regains ground

Materials, industrials, consumer staples and health care turned positive and helped the S&P 500 come off lows seen earlier in the trading day.

Materials was performing the best of the index's 11 sectors, gaining 1%. Industrials, consumer staples and health care followed in line, trading up 0.4%, 0.2% and 0.1%, respectively,

Energy flickered around the flatline. All 11 sectors were trading in the red earlier as stocks felt downward pressure from the strong labor data.

About half of the sectors remained down. Information technology was the worst performer, losing 1.1%. The other laggards were communication services (-0.3%), consumer discretionary (-0.4%), real estate (-0.6%), financials (-0.7%) and utilities (-0.7%).

The broad index was down 0.4%, shaking off some of its earlier losses.

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— Alex Harring

Stocks narrow losses coming off jobs data

Stocks have been able to shake some of the losses from the better-than-expected jobs data released before the bell Friday.

The Dow was down 63 points after hitting a session low of more than 300 points down. That means the 30-stock index was trading just 0.2% lower after once cracking more than 1% down.

The S&P 500 lost 0.4%, coming off a low of 1.2% in the red.

The Nasdaq was the worst performing, down 0.5%. But that's an improvement from earlier in the trading day, when it lost as much as 1.6%.

— Alex Harring

Portfolio manager says to 'buy the dip' following jobs data

Despite stronger than expected data around hourly wages and added jobs, the Fed will still likely need to move to a rate hike of 50 basis points at the December meeting, according to Bryce Doty, senior vice president and senior portfolio manager at Sit Investment Associates.

He said the data may initially "spook" investors because it could point to the economy not contracting enough. But Doty said Fed Chair Jerome Powell and the rest of the central bank understand that Congress has a role to play in encouraging work as strength in wages can be tied to the labor shortage.

With this in mind, Doty still expects the Fed to move from a 75 basis point rate hike to a 50 point rate hike. And the current drop in the stock market on the back of the data could be the right time to increase exposure, he said.

"The surprisingly high increase in hourly earnings may initially spook investors bracing for the Fed to react with another aggressively rate increase," he said. "However, Powell acknowledged that Congress would likely need to do something to encourage more people to work and that the Fed is still going to only raise rates by 0.50% December 14th. Consequently, we think it makes sense to 'buy the dip' today."

— Alex Harring

Nasdaq on pace for best week of major indexes

The Nasdaq Composite is on pace for the best week of the three major indexes.

The tech-heavy average is poised to end the week up 1.1%. The S&P 500 is looking at a smaller gain on 0.4%.

Meanwhile, at the tail-end of a tumultuous week, the Dow is on track to end down 0.4%.

— Alex Harring

Blackstone will have difficult road ahead, Barclays predicts

Barclays anticipates a challenging near-term for Blackstone after the investment firm limited withdrawals from its large retail real estate fund.

The bank downgraded shares of Blackstone to equal weight from overweight. It also cut the stock's price target to $90 from $98, now implying an upside of nearly 6%.

"While we are positive on the longer-term retail opportunity for alternative assets (and BX generally) we think near-term sentiment for both retail and BX shares will be very challenging," wrote Benjamin Budish in a note to clients.

Blackstone shares traded down 2.5% in Friday trading.

CNBC Pro subscribers can read the full story here.

— Carmen Reinicke

Jobs data shows 'volatility will continue to be the name of the game,' investing pro says

The stronger-than-expected jobs data should signal to investors that the stock market will continue to be volatile, according to Guido Petrelli, CEO of Merlin Investor.

"Buckle up as the rollercoaster in the market is yet to be over," Petrelli said. "Today's surprise just confirmed that volatility will continue to be the name of the game in the months to come and until we're able to see consistent data over a longer timeframe, alongside a reduction in inflation and a slowdown of the labor market."

— Alex Harring

Dow pares losses but opens down as first hour of trading kicks off

The Dow was down 225 points, or 0.7%, as investors began trading.

Though the 30-stock index felt downward pressure from the stronger-than-expected jobs data, it made up ground from a drop of more than 400 points seen in pre-market trading.

Meanwhile, the Nasdaq Composite and S&P 500 lost 1.3% and 0.9%.

— Alex Harring

Stock futures tumble, bond yields rise on back of hotter-than-anticipated jobs data

Stock futures dropped while bond yields rose in response to the 8:30 a.m. jobs data that came in stronger than expected by economists.

Here's how each major futures index and the notable bond yields moved over the course of the 30 minutes leading up to and following the release of the data:

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— Alex Harring

The upside surprise in wages is driving the market, Boockvar says

Peter Boockvar, chief investment officer at Bleakley Financial Group, said the market reaction Friday was motivated by the outsized increase in wages in the jobs report.

"The freakout in the markets, both bonds and stocks, is being driven by the upside surprise in wages," Boockvar said.

Average hourly earnings jumped 0.6% for the month, double the Dow Jones estimate. Wages were up 5.1% on a year-over-year basis, also well above the 4.6% expectation. Boockvar said it has been the trend for most of this year and double the pace seen in the 20 years leading into the pandemic. 

"Bottom line, today's hot wage data matches up with what Jay Powell was highlighting on Wednesday in terms of what can keep inflation stickier for longer as this translates the most into more persistent services inflation," Boockvar said.

— Yun Li

Treasury yields jump after jobs report

Treasury yields popped on Friday as November jobs report showed the U.S. economy added more jobs than expected.

The yield on the 10-year Treasury jumped 8 basis points to 3.64%. On Thursday, it fell by as many as 19 basis points. The 2-year Treasury yield soared 14 basis points to 4.41%.

In another blow to the Fed's anti-inflation efforts, average hourly earnings jumped 0.6% for the month, double the Dow Jones estimate. Wages were up 5.1% on a year-over-year basis, also well above the 4.6% expectation.

BMO's head of U.S. rates Ian Lyngen called the jump in average hourly earnings the most surprising detail in the report.

"Overall, this is a report that solidifies 50 bp from the FOMC in less than two weeks -- with the wage data and unanticipated drop in participation reinforcing the case for a longer period in restrictive territory in 2023 (and possibly beyond)," Lyngen said.

— Yun Li

U.S. payrolls jumped by 263,000 in November

Job growth was stronger than expected in November despite the Federal Reserve's efforts to cool the labor market.

Nonfarm payrolls grew by 263,000 last month while the unemployment rate was unchanged at 3.7%, according to the Labor Department on Friday.

Payroll numbers were expected to jump by 200,000 more jobs, according to consensus estimates from the Dow Jones. The unemployment rate was expected to remain at 3.7%.

Stock futures dropped following the payrolls release.

— Sarah Min

Stocks making the biggest pre-market moves: DoorDash, Marvell, and more

These are some of the stocks making the biggest pre-market moves:

Marvell Technology – Shares slid 4.9% in the premarket after the chip makers reported quarterly sales and profit fell short of Wall Street estimates and a weaker than expected outlook. The company said its being hurt by inventory reductions from customers.

Zscaler – The cloud security company fell 9.1% on its report of conservative guidance despite an expectation-beating quarter. Zscaler said customers are taking longer to close new deals.

DoorDash – DoorDash shares fell 2.8% in premarket trading after RBC Capital Markets downgraded the stock to "sector perform" from "outperform." RBC praised the delivery service's execution and management, but said it's uncomfortable with the current valuation given the potential for order deceleration.

See the full list here.

— Peter Schacknow, Alex Harring

Stocks sit slightly down as investors brace for jobs data

The major futures indexes were slightly down one hour before the release of key jobs data that could offer insights into the health of the U.S. economy.

Futures for the Dow and Nasdaq 100 each shed 0.1%. Meanwhile, S&P 500 futures were near the flatline.

Investors will be watching for a number that market observers say needs to be at a sweet spot. The data should weak enough to signal interest rate hikes are having the intended impact of cooling the economy, they say, while still being strong enough to indicate the U.S. can avoid a recession.

— Alex Harring

Tesla shares slightly higher

Tesla shares were slightly higher in premarket trading after CEO Elon Musk delivered the first Semi trucks to PepsiCo at an event on Thursday.

The trucks were first unveiled in 2017 and originally due to be produced in 2019 but were delayed by the pandemic and other issues.

— John Melloy

European markets: Here are the opening calls

European markets are heading for a lower open Friday, as investors eye an EU-led cap on Russian oil prices and non-farm payrolls data from the U.S.

The U.K.'s FTSE 100 index is expected to open 11 points lower at 7,547, Germany's DAX is seen down 15 points at 14,448, France's CAC is forecast to open 15 points lower at 6,728 and Italy's FTSE MIB is also seen falling by 98 points at 24,609, according to data from IG.

Data releases include German import and export data, producer prices for the euro zone and U.S. nonfarm payrolls, the latter due at 1.30 p.m. London time.

— Katrina Bishop

CNBC Pro: Citi names 6 global stocks that capture both 'defensive growth and value'

Citi says investors don't need to give up entirely on growth by pivoting to a defensive portfolio of stocks ahead of a potential recession.

The investment bank named six global stocks which offer "low risk, quality and growth" combined.

CNBC Pro subscribers can read more here.

— Ganesh Rao

CNBC Pro: BlackRock unit says it's time for a new portfolio playbook, and reveals how to position

BlackRock's ETF division says the investing environment has fundamentally changed, which has "profound implications" for portfolios looking ahead.

In its 2023 investor guide, Blackrock's iShares, one of the largest providers of exchange-traded-funds in the world, said the shift brings with it "profound implications for portfolio construction."

CNBC Pro subscribers can read more here.

— Weizhen Tan

Stocks making the biggest moves after hours

These are the companies making the biggest moves in extended trading Thursday evening:

Asana — Shares of the work management platform operator plunged 11% after the company reported a loss for the most recent quarter on a non-GAAP basis and issued weaker-than-expected guidance.

Zscaler — The cloud security company saw its shares dip 10% despite posting strong quarterly results and issuing upbear guidance.

Marvell Technology — The semiconductor stock fell 6.5% after the company reported weaker-than-anticipated quarterly results and gave a weaker-than-expected outlook.

PagerDuty — Shares of the IT company rose almost 4% after reporting a slight profit for the third quarter, beating analysts' expectations of a loss.

Read more here.

— Tanaya Macheel

November’s big jobs report on the horizon

Investors are keying in on November's nonfarm payrolls report, which the U.S. Bureau of Labor Statistics will post at 8:30 a.m. ET on Friday.

Economists polled by Dow Jones expect employers added 200,000 jobs last month, up from October's gain of 261,000 posts.

They also expect the unemployment rate to hold steady from the prior month at 3.7%.

Economists anticipate that average hourly wages grew by 0.3% on a monthly basis and by 4.6% from the prior year. Back in October, wages gained by 0.37% from the prior month and were up 4.73% on an annual basis.

Darla Mercado

Stock futures open slightly lower

Stock futures opened slightly lower on Thursday night ahead of the key U.S. jobs report Friday.

Dow Jones Industrial Average futures were lower by 19 points, or 0.06%. S&P 500 futures dipped 0.1% and Nasdaq 100 futures fell 0.2%.

— Tanaya Macheel