U.S. equities rose to record levels on Friday as Wall Street parsed through a jobs report that came in well below expectations.
The Dow Jones industrial average traded about 45 points higher and reached its first intraday record since March 1, with Boeing contributing the most gains. The S&P 500 also managed a new all-time intraday high, trading 0.2 percent higher.
The Nasdaq composite outperformed, rising 0.5 percent to reach an all-time high.
“This was the closest thing to a nonresponse you’re going to see,” said Michael Shaoul, chairman and CEO of Marketfield Asset Management. “This isn’t a report that warrants a strong response in financial markets and I don’t think you’re going to get one.”
The Labor Department said 138,000 jobs were created last month, well below the expected 185,000. Wages also grew less than expected, with average hourly earnings rising at a 2.5 percent annualized rate. The unemployment rate, however, fell to 4.3 percent from 4.4 percent.
“There are some sectors in the jobs market that are seeing strong wage growth and others that aren’t,” said Andrew Chamberlain, chief economist at Glassdoor. “I think that’s reflective of the tightness seen in some sectors.”
Chamberlain also noted the U.S. economy has added jobs for 80 straight months now, the longest positive streak dating back to the 1930s.
Stocks futures gave back some gains after the data were released. Dow futures traded 41 points higher, while S&P and Nasdaq futures gained 3 points and 14.5 points, respectively. Heading into the 8:30 a.m. ET release, Dow futures were trading nearly 70 points higher, while S&P and Nasdaq had risen 4.75 points and 17.75 points, respectively.
“It’s hard to ignore the the U.S. economy added fewer jobs than expected and, more importantly, the number came in below the 12-month average of 181,000,” said Sharon Stark, managing director of fixed income strategies at Incapital.
Investors eagerly awaited the report as it is one of the last major data sets released before the Federal Reserve holds its June monetary policy meeting. Market expectations for a rate hike were near 94 percent, according to the CME Group’s FedWatch tool.
“The fall in job growth numbers may make some query the likelihood of a rate rise next month, however, one slightly disappointing month does not constitute a wholesale change in fortunes,” said Kully Samra, UK managing director at Charles Schwab, in a note.
“This is not so much a downward trend away from the strong jobs market but merely a temporary blip on the radar,” Samra said.
Treasury yields fell on the back of the jobs number, with the benchmark 10-year yield slipping to 2.16 percent; it also hit its lowest level since May 18 earlier in the session.
The dollar also dropped against a batch of major currencies, with the dollar index slipping 0.43 percent to 96.78. In turn, the euro rose 0.53 percent to $1.127 against the U.S. currency.