U.S. stocks came under downward pressure on Friday and Treasury yields were slightly more volatile after mixed August jobs data sparked a debate over the size of interest rate cuts the Federal Reserve plans to make later this month.
Futures initially pared losses before the open after the nonfarm payrolls data was released. Meanwhile, Treasury yields reacted quickly to fall as bonds were bought. The three major indexes then opened higher but have since fallen steadily to hit session lows. Yields have since been fluctuating up and down.
The Nasdaq Composite Index (COMP:IND) was -1.43% In morning trading, the benchmark S&P 500 (SP500) -0.83%. Blue chip stock index Dow (DJI) was -0.32%.
The 10-year Treasury yield (US10Y) fell 1 basis point to 3.72%. The 2-year Treasury yield (US2Y) fell 4 basis points to 3.71%.
US Nonfarm Payrolls for August was +142K, beating the consensus estimate of +160K and July's +89K (revised from +114K).
The unemployment rate was 4.2%, above the consensus forecast of 4.2% and above July's 4.3%.
The mixed data has traders debating whether the Fed will deliver a bigger half-point rate cut later this month or a smaller 25 basis point cut.
U.S. stock averages ended mixed on Thursday, with only the Nasdaq closing higher, helped by Nvidia (NVDA).
Deutsche Bank's Henry Allen said September was living up to its reputation as the weakest month for the S&P 500 index.
Broadcom (AVGO) stock Falling 9.6% Shares fell in premarket trading on Friday after the semiconductor and software giant issued a weaker-than-expected fourth-quarter earnings outlook.
The latest jobs report triggered a sell-off in the stock market as concerns resurfaced that the economy was heading toward a recession.
Paul Donovan of UBS said just a month ago markets were panicked by unreliable labor market signals that were distorted by seasonal idiosyncrasies.
