S&P 500, Dow End Lower As Blowout Jobs Report Fans Rate Hike Fears, While Chipmaker Strength Aids Nasdaq -TSLA, NFLX, BE, NVDA In Focus

• The S & P 500 ended Friday 0.4% lower, while the Nasdaq 100 added 0.2% and the Dow Jones Industrial Average fell 0.5%.
• Bessent sees oil as low as $40 after the Iran war ends.
• Citi expects rate cuts to be delayed until 2027 following strong jobs data. 

The S & P 500 and Dow Jones Index fell on Friday after a strong jobs report pushed bond yields higher, raising concerns that the Federal Reserve could hike rates at its September meeting. 

The S & P 500 ended Friday 0.4% lower, while the Nasdaq 100 added 0.2% and the Dow Jones Industrial Average fell 0.5%. The Russell 2000, which tracks stocks with small market capitalizations, rose about 0.3%.

Among ETFs tracking benchmark indexes, the SPDR S & P 500 ETF (SPY) fell 0.4%, and Invesco QQQ Trust (QQQ) ended Friday flat, while the SPDR Dow Jones Industrial Average ETF Trust (DIA) was down 0.7%.

Meanwhile, the VanEck Semiconductor ETF (SMH) added 2.5%, while the iShares Semiconductor ETF (SOXX) rose 3.2%, with Nvidia (NVDA), Micron Tech (MU), Advanced Micro Devices (AMD) and ASML Holdings (ASML) aiding gains. The broader Vanguard Information Technology ETF (VGT) rose 0.3%.

Retail sentiment on Stocktwits for QQQ, SPY, and DIA was between 'bearish' and 'neutral' with 'high' message volumes. 

US Market Drivers

The domestic economy saw a strong acceleration in hiring this August, rebounding from sluggish summer employment growth as the jobless rate remained unchanged.

Nonfarm payrolls expanded by 162,000 for the period, while the unemployment rate held steady at 4.1%, according to Friday's Bureau of Labor Statistics report. The figure significantly outperformed the 53,000 payroll addition projected by Dow Jones economists.

“A monster jobs report for August reminds us that this labor statistic has become highly volatile while nudging up the probability of a September hike slightly,” Bradford Smith at Janus Henderson Investors told CNBC.

Government bond rates climbed on the heels of the data, as the 2-year Treasury

yield reached a peak not seen since January 2025. Market anticipation for a September rate increase intensified, with CME FedWatch tool data showing futures traders now see a 58% probability of a hike. This marks a notable jump from the 49.4% odds recorded just one day prior.

Meanwhile, Citigroup pushed back its forecast for the Federal Reserve's next interest-rate cut to mid-2027, citing strong U.S. employment figures that signal continued labor-market strength and reduce the rationale for near-term monetary easing.

Key Trending Stocks

Tesla (TSLA): A Cybercab event left investors disappointed, but the electric-vehicle maker was still valued at about $1.11 trillion. 

Netflix (NFLX): The streaming platform hiked rates across its subscription tiers in the United Kingdom, delivering a notable markup to its budget-friendly options as it seeks to boost top-line revenue growth in mature international markets. Nvidia (NVDA): Analysts backed the chipmaker's $12.93 billion acquisition of AI platform Hugging Face, saying the deal gives Nvidia greater access to the software and developer ecosystem around AI models. 

Bloom Energy (BE): Bloom Energy will be included in the S & P 500 starting September 21 alongside Illumina (ILMN) and Everpure (P).

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