Stocks lost momentum and fell in afternoon trading Friday as some investors pulled back after strong gains led by big tech companies. February's jobs report also showed an increase in the unemployment rate, increasing investors' confidence that the Federal Reserve will cut interest rates after its June meeting.
The S&P 500 (^GSPC) remained mostly flat after setting a new record close on Thursday, while the Dow Jones Industrial Average (^DJI) rose nearly 0.3%. The tech-heavy Nasdaq Composite Index (^IXIC) fell 0.3% after surging the previous day.
Friday's nonfarm payrolls report showed the U.S. economy added 275,000 jobs in February, again well ahead of Wall Street expectations. However, the unemployment rate rose to 3.9%, the first increase in four months. Ahead of the employment report, futures prices for the three major averages were trading in the red.
This week, Chairman Jerome Powell told lawmakers it is “not long” before the Fed is confident that inflation is in the right conditions for the central bank to start lowering borrowing costs. The market was pushed up.
With inflation falling faster than expected, European Central Bank policymakers lined up to support interest rate cuts ahead of the summer break, showing the wind is blowing elsewhere. Meanwhile, Bank of Japan officials are said to be open to the idea of eventually raising interest rates from negative territory.
On the corporate side, Costco (COST) stock fell 7%, overshadowed by quarterly sales that did not beat earnings. Broadcom (AVGO) failed to impress investors after sales exceeded expectations for $10 billion in AI-related chip sales, sending its stock down more than 6%.
In the commodity market, gold futures (GC=F) continued to rise as spot gold prices aimed for their biggest weekly gain in five months amid optimism about a mid-year Fed rate cut.
live7 updates
-
-
-
-
-
-
-
Costco is Costco
Costco (COST) is Costco and has historically performed very well for investors.
The company sells giant hot dogs for $1.50 in the food court (and they're delicious, as you can see in this 2022 photo with outgoing CEO Craig Jelinek). In the most recent quarter, online sales rose 18% due to demand for gold bars. To my surprise, I found (and bought) two tomahawk steaks at my local Costco for $40 (about 5 pounds of meat) a few weeks ago.
Costco just does things differently, and it's in its DNA. The stock price has increased by +245% over the past five years as members are happy with their purchases.
So I wasn't surprised when Costco's longtime CFO, Richard Galanti (who will soon be retiring), announced during last night's earnings call that the company is getting into the sushi business.
“We recently opened our first fully-operated sushi restaurant in Issaquah, Washington, across the street from our corporate headquarters, and we plan to open two more locations in the near future. It has been successful for many years.”
Sign me up for a California roll, Rich.
I recommend Costco's hot dogs. On the right is now retired Costco CEO Craig Jelinek. (Yahoo Finance)
