Wall Street Today | Stocks Trade Higher While Bonds Sink on Job Market Cooldown, Rates Unchanged

U.S. stocks traded higher Friday after a weaker-than-expected October jobs report sent Treasury yields lower. Following a dramatic week of loss, indexes returned strong after the FOMC decided to keep rates where they were.

All three indexes are on track for their strongest weekly gains since the week ended October 2022, while the S&P 500 and Nasdaq are headed for their strongest weekly rises since November of last year.

“The market is increasingly confident that the Fed is done hiking,” said Tom Graff, chief investment officer at Facet, told MarketWatch.

The October employment report showed a "gradual lessening" of the job market that would be welcome by those who want the Federal Reserve to stop raising interest rates, said Richmond Federal Reserve President Tom Barkin on Friday.

What we saw today was data that showed a gradual lessening of the job market. I think that's what those who would like not to see another rate hike would want to see," Barkin said in an interview on CNBC. Barkin ducked questions about whether he thought the Fed might be done raising interest rates.

"I don't prejudge what the Fed might do, including at its next meeting in December 12-13," Barkin said. "We just got out of the last meeting."

Treasuries rallied, with 10-year yields heading for their biggest three-day decline since the onset of the pandemic in 2020, as signs of softening US labor data fueled speculation that the Federal Reserve is done hiking interest rates.

Friday, yields on 10-year bonds dropped 13 basis points to 4.5%, extending their decline since Tuesday to roughly 40 basis points after a government report showed the unemployment rate rose to an almost two-year high and wage growth slowed. Over the past three decades, a move of this magnitude only occurred 10 times prior to this week.

During the last three trading days, the yield on 10-year notes declined by 12.2 basis points to close at 4.668% on Thursday. This marks the longest losing streak since the end of August. Similarly, the yield on 30-year notes fell for a three-day decline.

Oil headed for a second weekly loss after the risk premium from the Israel-Hamas war vanished, bringing signs of soft demand to the fore.

West Texas Intermediate slid about 2% to below $81 after the leader of the Iran-backed militant group Hezbollah said it did not know about the attack on Israel, reinforcing views that the war will remain contained. A soft US jobs report supports speculation the Fed can stop increasing rates, and a weaker dollar made crude more affordable for importers.

Sam Bankman-Fried’s conviction on multiple fraud charges stemming from the blowup of the FTX exchange came at a conspicuous time for the cryptocurrency market — right when prices were flying high again following a rout last year that wiped out $2 trillion from the value of digital assets.

That rally has lost steam over the past two days, with Bitcoin dipping as much as 3.7% after previously more than doubling in 2023 and approaching a nearly 18-month high of almost $36,000. Solana’s SOL token, which counted Bankman-Fried’s FTX and Alameda Research as major backers and tumbled 94% last year, lost as much as 9.8% over Thursday and Friday.

U.S. companies that sell cryptocurrency showed mixed results—this week, Block jumped 17% at open on Friday before pulling back after the company unveiled targets for more efficient growth late Thursday. In comparison, Coinbase dropped in early trading but flattened out to a 1% rise after weaker results.