U.S. stocks closed lower on Friday after a mixed June jobs report that showed a better-than-expected increase in nonfarm payrolls but a rise in the unemployment rate.
The Dow Jones Industrial Average fell 0.4% to 34,633.53, while the S&P 500 declined 0.2% to 4,319.94. The Nasdaq Composite edged down 0.1% to 14,522.38.
The Labor Department reported that the U.S. economy added 850,000 jobs in June, beating the consensus estimate of 706,000. However, the unemployment rate rose to 5.9% from 5.8% in May, as more people entered the labor force but failed to find work.
The jobs data suggested that the labor market recovery is gaining momentum but still faces challenges from labor shortages, skills mismatches and childcare issues. Investors also weighed the implications of the report for the Federal Reserve’s monetary policy stance, as the central bank has said it will maintain its ultra-easy policy until it sees substantial progress on its employment and inflation goals.
“The June employment report was a solid report overall that should keep the Fed on track with their current policy stance,” said Michael Pearce, senior U.S. economist at Capital Economics. “But with inflation running well above target and likely to remain elevated in the near term, we still expect the Fed to announce a tapering of its asset purchases later this year.”
Among individual stocks, Nike rose 2% to a record high after the athletic apparel maker reported strong quarterly earnings and sales that topped analysts’ expectations. Apple also gained 2% and became the first U.S. company to reach a $3 trillion market capitalization.
On the other hand, Walgreens Boots Alliance dropped 7.6% after the drugstore chain lowered its full-year earnings guidance due to uncertainty related to the Covid-19 pandemic. Carnival fell 5.4% after the cruise operator said it expects a net loss of $2 billion in the third quarter.
