US stocks fall after blockbuster January jobs report suggests more hawkish Fed moves ahead

A trader works at the New York Stock Exchange NYSE in New York, the United States, on March 9, 2022.Michael Nagle/Xinhua via Getty

• US stocks fell on Friday after a blockbuster jobs report suggested more hawkish Fed rate hikes.

• The US economy added 517,000 jobs in January, which trounced expectations of just 188,000.

• The unemployment rate fell to 3.4%, representing its lowest level in 54 years.

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US stocks fell on Friday after a blockbuster January jobs report suggested the Federal Reserve will continue to be hawkish with more interest rate hikes.

The US economy added 517,000 jobs in January, more than double the estimate of 188,000. The unemployment rate fell to 3.4%, representing the lowest level in 54 years.

The continued strength of the labor market could be a hindrance to Fed Chairman Jerome Powell's quest to tame inflation, as a tight labor market often leads to higher wage gains. After the jobs report, the chances of further interest rate hikes in March and May increased significantly, according to the CME FedWatch Tool.

Also weighing on stocks on Friday were the earnings results from mega-cap tech giants Apple, Amazon, and Alphabet. All three companies reported disappointing results and mixed guidance that sent the stocks tumbling as much as 5%.

So far, about half of S&P 500 companies have reported fourth-quarter earnings. Of those companies, 70% are beating profit estimates by a median of 6%. Meanwhile, 62% of those companies are beating revenue estimates by a median of 4%, according to Fundstrat.

Here's where US indexes stood shortly after the 9:30 a.m. ET open on Friday:

• S&P 500: 4,133.25, down 1.11%

• Dow Jones Industrial Average: 33,916.20, down 0.40% (137.74 points)

• Nasdaq Composite: 11,971.61, down 1.88%

Here's what else is happening this morning:

• Nordstrom soared more than 30% on Friday after a report said activist investor Ryan Cohen is building a stake in the retailer. Cohen is known for his involvement in meme-stock GameStop.

• The US Justice Department is reportedly investigating Silvergate Capital's ties with FTX and its trading arm Alameda Research.

• Logan Paul has been named as a defendant in a lawsuit that alleges the YouTube star helped perpetrate a crypto "rug pull" scam by promoting an NFT-based project that scooped up buyers' money.

In commodities, bonds and crypto:

• West Texas Intermediate crude oil rose 0.40% to $76.18 per barrel. Brent crude, oil's international benchmark, edged up 0.26% to $82.38.

• Gold fell 1.80% to $1,896.10 per ounce.

• The yield on the 10-year Treasury jumped 10 basis points to 3.50%.

• Bitcoin fell 0.72% to $23,348, while ether dropped 0.26% to $1,636.

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