Big Tech Wins on Wall Street as Dismal US Jobs Knock off Fed Stimulus Taper Hopes
© AP Photo / Mark Lennihann this Nov. 5, 2020 file photo, a sign for Wall Street is carved in the side of a building. Stocks are easing lower in early trading on Wall Street, pulling major indexes slightly below the record highs they reached last week.
© AP Photo / Mark Lennihan
NEW YORK (Sputnik) - Wall Street’s tech sector had its biggest winning week since mid-July after a dismal US jobs report on Friday reinforced bets that stimulus money will continue flowing to the US economy.
The Nasdaq Composite Index, which includes stocks of technology giants such as Facebook, Amazon, Apple, Netflix and Google, settled at 15,363, up 32 points or 0.2 percent.
Nasdaq has gained 19 percent this year, with nearly 4 percent, or a quarter of that, coming in August alone on expectations that the Federal Reserve will continue with its monthly buying of $120 billion of stocks and bonds that have juiced gains for Big Tech stocks.
That conviction was strengthened after the Labor Department reported that employers added just 235,000 jobs in August, less than a third of the forecast 733,000, amid continued struggles with the pandemic.
Prior to the August jobs report, there had been rife speculation that the Fed might taper some of its lifeline to the economy. The central bank has also been keeping interest rates at virtually zero levels for the past 18 months.
“It seems the US economy isn’t just yet getting closer to reaching substantial progress with the labor market recovery,” Ed Moya, analyst at New York’s OANDA, said. “That will disappoint Fed hawks that were looking to claim further that the labor market recovery is now delivering further substantial progress.”
Nasdaq was the only winner among major US stock indexes on Friday.
The Dow Jones Industrial Average, the broadest US equity barometer on the New York Stock Exchange that lists mostly industrial stocks, settled at 35,369, down 75 points or 0.2 percent on the day. The Dow is still up 16 percent on the year.
The S&P 500, which groups the top 500 stocks on the New York Stock Exchange, closed at 4,536, virtually unchanged on the day. Like Nasdaq, the S&P is up about 20 percent on the year.