NEW YORK – The Dow rose more than 1 per cent to a record closing high on July 2 ahead of the long holiday weekend as a softer-than-expected US jobs report eased worries about interest rate hikes, while another sharp drop in chipmaker stocks weighed on the Nasdaq.
The S&P 500 ended flat on the day. The Dow recorded a fourth straight week of gains, its longest such streak since October 2024.
The US market will be closed on July 3 in observance of the US Independence Day holiday.
The US nonfarm payrolls report showed the economy added 57,000 jobs in June, far below economists’ estimates for a rise of 110,000.
The unemployment rate was 4.2 per cent, in line with expectations of 4.3 per cent. The employment report followed a run of strong job gains recently.
Expectations for a rate hike from the Federal Reserve decreased after the report, according to CME FedWatch. For the September meeting, hike expectations dimmed to 55 per cent from 64.1 per cent.
The jobs report “doesn’t mean the fear of inflation is over,” said Adam Sarhan, chief executive at 50 Park Investments in New York. “It just takes the pressure off the Fed to raise rates in the short term.”
Investors have been worried about inflation especially given sharp gains in oil prices at the start of the Iran war.
Apple shares rose 4.8 per cent and helped to support all three major indexes. Nikkei Asia reported that Apple plans to launch five new iPhone models. On the flip side, an index of semiconductors ended 5.4 per cent lower on July 2, falling sharply for a second day.
Shares of Nvidia fell 1.4 per cent while SanDisk dropped 14.1 per cent. Investors are likely taking profits in chip stocks following this year’s strong gains, said Bruce Zaro, managing director at Granite Wealth Management in Plymouth, Massachusetts. The semiconductor index remains up about 78 per cent for the year to date.
The Dow Jones Industrial Average rose 594.83 points, or 1.14 per cent, to 52,900.07, the S&P 500 gained 0.01 points to 7,483.24 and the Nasdaq Composite lost 207.36 points, or 0.8 per cent, to 25,832.67.
For the week, the Dow rose about 2 per cent, the S&P 500 gained 1.8 per cent and the Nasdaq advanced 2.1 per cent.
Tesla shares dropped 7.5 per cent even though the electric carmaker posted second-quarter deliveries above estimates. Tesla shares had risen sharply this week ahead of the report. Among other decliners in stocks, Bending Spoons dropped 11.3 per cent, a day after the Vimeo owner gained 40 per cent in its debut on the Nasdaq.
Advancing issues outnumbered decliners by a 1.42-to-1 ratio on the NYSE. There were 318 new highs and 111 new lows on the NYSE.
On the Nasdaq, 2,419 stocks rose and 2,548 fell as declining issues outnumbered advancers by a 1.05-to-1 ratio.
The S&P 500 posted no new 52-week highs and no new lows while the Nasdaq Composite recorded no new highs and no new lows.
Volume on US exchanges was 19.92 billion shares, compared with the 23.34 billion average for the full session over the last 20 trading days. REUTERS
