The S&P 500 and the Nasdaq Composite closed at fresh record highs Friday after official data showed the economy added more jobs than expected in June.
The technology-heavy Nasdaq jumped 0.9% to 18,352.8, while the S&P 500 rose 0.5% to 5,567.2. The Dow Jones Industrial Average added 0.2% to 39,375.9. Communication services led the gainers among sectors, up 2.7%, while energy saw the steepest decline, down 1.5%.
US markets were closed Thursday in observance of Independence Day.
For the week, the Nasdaq surged 3.5%, while the S&P 500 advanced 2%. The Dow gained 0.7%.
In economic news, total nonfarm payrolls in the US climbed by 206,000 last month, the Bureau of Labor Statistics reported. The consensus was for a 190,000 gain, according to a survey compiled by Bloomberg. The unemployment rate edged up to 4.1% from May's 4%, which was the market view for June.
The latest report shows "more signs of cooling" in the labor market, Oxford Economics said in a note to clients. "Federal Reserve officials have become increasingly focused on the downside risks to the labor market, and the June data bolster our forecast for the Fed to cut rates in September and at every other meeting thereafter."
The US two-year yield slumped nine basis points to 4.60% Friday, while the 10-year rate dropped 6.9 basis points to 4.28%.
New York Fed President John Williams said that although policymakers have made progress in their fight against inflation, they still have "a way to go" to reach their objective, Reuters reported.
"We have seen significant progress in bringing (inflation) down," Williams reportedly said. However, "we still have a way to go to reach our 2% target on a sustained basis. We are committed to getting the job done."
On Tuesday, Fed Chair Jerome Powell reportedly said the central bank's Federal Open Market Committee has made "quite a bit of progress" in bringing inflation back to its target, but it needs to see more encouraging data before lowering interest rates.
West Texas Intermediate crude oil dropped 0.9% to $83.12 a barrel Friday.
In company news, Carlyle Group (CG) is in advanced talks to acquire Vantive from Baxter International (BAX) for more than $4 billion, including debt, The Wall Street Journal reported, citing unnamed sources. Baxter shares jumped 5.3%, the second-best performer on the S&P 500, while Carlyle fell 0.7%.
Constellation Brands (STZ) was among the top gainers on the S&P 500, up 3.5%, as UBS, Jefferies, and JPMorgan upgraded their respective price targets on the stock. Earlier this week, the beer and wine company maintained its full-year revenue outlook after reporting that its earnings and revenue rose year over year during the fiscal first quarter.
Chevron (CVX) is putting workers on furlough at a biodiesel plant in Oeding, Germany, with the factory out of operation due to oversupply in the market, Bloomberg News reported Friday, citing an email from the company and a plant spokesman. Chevron shares fell 1.5%, the steepest decline on the Dow.
Gold increased 1.2% to $2,397.40 per troy ounce, while silver gained 2.2% to $31.52 per ounce.