By Christine Idzelis and Mark DeCambre
“While disappointing on the headline number, the rest of the report was much better and this may help explain why stocks are rolling over,” wrote Michael Hewson, chief market analyst at CMC Markets UK, in a daily note.
Investors are scrutinizing the jobs report, because if the Fed deems it a positive, the central bank could speed up interest-rate hikes and deliver a hit to rate-sensitive, growth-oriented stocks in the technology sector.
“Markets have a lot to digest as the economy is strong, but the labor market is reaching its full potential and inflationary forces are already elevated, which is why the Fed is feeling more urgency to complete their tapering early and may need to raise interest rates more quickly than many people are expecting,” wrote Chris Zaccarelli, chief investment officer for Independent Advisor Alliance.
The market also has harbored lingering concerns that tech valuations were too lofty, which, perhaps, are highlighted by the precipitous decline in shares of DocuSign DOCU , down 42.2% Friday after the electronic-signature company billings and revenue forecast missed expectations and its chief executive said the pandemic boom had worn off in the quarter.
In other economic reports Friday, the final November reading of IHS Markit’s purchasing managers index geared to the service sector was 58 versus an initial reading of 57. The more closely watched services reading from the Institute for Supply Management rose to 69.1 in November from 66.7, above forecasts. A reading of 50 or better indicates improving conditions. U.S. factory orders were up by 1% in October.
In U.S. politics, Congress’s passage late Thursday of a short-term extension of government funding, through Feb. 18., averts a partial shutdown after resolving a standoff over vaccine rules. On Friday, President Joe Biden signed the bill into law to keep the federal government running.
Which companies were in focus?
U.S. listed shares of Chinese companies fell into focus on Friday, after Chinese ride-hailing giant Didi Global DIDI said late Thursday it will delist from the New York Stock Exchange , following pressure from the Chinese government. Shares of Didi plunged 22.2% Friday.
How did other assets trade?
The yield on the 10-year Treasury note BX:TMUBMUSD10Y fell Friday more than 10 basis points to 1.342%. The yield fell 14.2 basis points this week for its largest weekly decline since June 2020, according to Dow Jones Market Data. Prices for Treasurys fall as yields rise.
The ICE U.S. Dollar Index DXY , a measure of the currency against a half-dozen other monetary units, was little changed.
Gold futures /zigman2/quotes/210034565/delayed GC00 +0.21% for February delivery rose 1.2% to settle at $1,783.90 an ounce. For the week, gold prices based on the most-active contract traded nearly 0.1% lower, according to Dow Jones Market Data.
The Stoxx Europe 600 Index /zigman2/quotes/210599654/delayed XX:SXXP +0.73% closed 0.6% lower Friday for a weekly decline of 0.3%. London’s FTSE 100 Index /zigman2/quotes/210598409/delayed UK:UKX +1.19% slipped 0.1% but remained up 1.1% for the week.
In Asia, the Shanghai Composite Index /zigman2/quotes/210598127/delayed CN:SHCOMP +1.60% closed 0.9% higher Friday for a weekly gain of 1.2%, while the Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +2.96% closed 0.1% lower in Hong Kong, bringing its decline for the week to 1.3%. Japan’s Nikkei 225 Index /zigman2/quotes/210597971/delayed JP:NIK +1.27% closed 1% higher Friday but still slid 2.5% for the week.
—Barbara Kollmeyer contributed to this article.