The Labor Department’s closely watched employment report on Friday showed nonfarm payrolls increased by 467,000 jobs last month, compared with the 150,000 jobs addition forecast by economists polled by Reuters.
The data for December was revised higher to show 510,000 jobs created, instead of the previously reported 199,000.
“Employment report really stunned markets … not only did we have a surprisingly strong number, we had a very strong revision,” said Edward Moya, senior market analyst at Oanda.
“You also have average hourly earnings coming in much hotter than expected, which is just fueling the theme that everything is just leading to more inflation.”
Futures were higher before the data as Amazon.com Inc’s robust earnings in the holiday quarter sent its shares up 11% in premarket trading, helping other growth stocks stage a recovery a day after Facebook-owner Meta Platforms Inc’s results shook markets.
“These are eye-watering, stomach churning moves normally associated with penny stocks, and yet they are happening in companies with billion-dollar market caps,” said Michael Hewson, chief market analyst at CMC Markets UK.
Despite the earnings-driven whiplash in technology stocks, all three major stock indexes are on track to end their first week of February higher, with the indexes eyeing their second week of gains in a row.
Following losses on Thursday, smaller social media companies such as Snap Inc surged 41.5% after reporting better-than-expected fourth-quarter user growth and outlook.
Pinterest Inc rose 6.9% after its quarterly revenue beat estimates as retailers splurged on advertising during the holiday quarter, while Twitter Inc, expected to report results on Feb. 10, rose 4.6%.
At 8:50 a.m. ET, Dow e-minis were down 173 points, or 0.49%, S&P 500 e-minis were down 13.25 points, or 0.3%, and Nasdaq 100 e-minis were up 0.5 points.
As of Thursday, 260 S&P 500 companies have reported results so far during this earnings season, and 78.5% of them have beaten analysts’ earnings estimates, compared with an average of 84% over the past four quarters, according to Refinitiv data.
Ford Motor Co fell 7.0% on missing fourth-quarter earnings estimates, while household products maker Clorox Co dropped 14.3% after trimming its annual profit outlook.
(Reporting by Bansari Mayur Kamdar and Medha Singh in Bengaluru; Editing by Shounak Dasgupta)
By Bansari Mayur Kamdar and Medha Singh