Stock market today: Dow in weekly win on blowout jobs report; U.S. averts default

Investing.com -- The Dow racked up gains Friday, wrapping up a weekly win as investors cheered strong labor market data, and news the debt-ceiling bill could likely be signed into law as soon as Saturday to avert a U.S. default.

The Dow Jones Industrial Average gained 2.1%, or 701 points, the Nasdaq gained 1.1% to close at 52-week highs, and the S&P 500 was up 1.4%.

The U.S. economy created 339,000 new jobs in May, well above the 180,000 expected, though the unemployment rate rose more than expected to 3.7% and wage growth climbed less than expected.

Following the better-than-expected job gains in May, Morgan Stanley said they continued to “see the Fed on hold at the June meeting, and think the bar will be too high for the Fed to resume hiking.”

On Capitol Hill, meanwhile, a measure to lift the debt limit and cut government spending was passed in the Senate, a key final hurdle for the legislative measure, which now moves onto President Biden’s desk to be signed into law and averts an unprecedented default.

[W]e’re going to work very quickly with them to get this done to make sure we can sign it, hopefully as soon as tomorrow,” Press Secretary Karine Jean-Pierre said Friday, responding to questions about when Biden might sign the legislative measure.

Energy stocks led the move higher for the second day in a row as oil prices gained on speculation that OPEC and its allies, or OPEC+, could announce a cut at its meeting in Vienna on Sunday.

“The decision to hold an in-person meeting in Vienna one month before everyone returns for the OPEC Seminar does raise the prospect that the group could decide to do a deeper cut to provide further support to the market as it continues to contend with broader macro concerns,” RBC said in a note.

Materials were also in the ascendency, driven by a 7% surge in Dupont De Nemours Inc (NYSE:DD) after the chemical company -- together with Chemours Co (NYSE:CC) and Corteva Inc (NYSE:CTVA) -- reached an agreement to settle allegations that they contaminated public water systems with toxic perfluoroalkyl and polyfluoroalkyl, substances (PFAS), or so-called forever chemicals.

Tech lagged the gains in the broader market, though remains set to end the week with strong gains following the AI-related surge in chip stocks this week including Nvidia (NASDAQ:NVDA).

Broadcom Inc (NASDAQ:AVGO) rose nearly 3% after reporting quarterly results that topped estimates, and saying that it expects more than a quarter of fiscal 2024 revenue to be driven by generative AI models such as ChatGPT.

Ahead of its developer conference that kicks off on Monday, Apple Inc (NASDAQ:AAPL) was slightly higher after Morgan Stanley hiked its price on the target to $190 from $185 on optimism that the tech giant will launch its new virtual reality headset that will boost growth.

“Our supply chain checks tell us Reality Pro general availability will likely come in the Dec '23 quarter, and that builds will ramp from 300,000 to 500,000 in calendar 2023, to 3M to 4M by 2025,” it added.

Elsewhere on the earnings front, Lululemon Athletica (NASDAQ:LULU) lifted its guidance after reporting quarterly results that topped estimates, sending its shares up almost 12%.

SentinelOne Inc (NYSE:S) slumped 35% after the cybersecurity company cut its annual sales outlook after reporting quarterly revenue that fell short of Wall Street estimates amid a weaker macroeconomic backdrop.

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