Wall Street recovers, ends weak week after employment report

US stocks closed higher on Friday, in a volatile session that snapped a four-session losing streak, as investors digested a mixed employment report and comments from officials of the Federal Reserve on the pace of interest rate hikes.

The S&P 500 and the Nasdaq rose by as much as 2% each, while the Dow Jones Industrial Average it gained as much as 1.9%, following the release of an expected labor market report, before paring gains and briefly dipping into negative territory.

The report showed an uptick in the unemployment rate from USA in October it overshadowed data showing strong job growth, supporting expectations that the Fed may make smaller rate hikes in the future.

Labor market data has been a main focus of attention for the markets, as the Fed he has repeatedly stated that he is looking for some cool down before considering a pause in climbing.

The aggressive comments of the chairman of the Fed, Jerome Powellon Wednesday raised fears that the central bank will raise borrowing costs for longer than expected.

“This was not a report that shows rate hikes are starting to take hold,” said Shawn Cruz, chief trading strategist at TD Ameritrade in Chicago.

On Friday, Fed officials echoed Powell’s comments on the possibility of decreasing the size of future rate hikes, but with the need to keep raising rates for a longer period of time and potentially , above the 4.6% level that the central bank set at its September meeting.

Equities got a late-session boost after Chicago Fed President Charles Evans said the Fed may be thinking of pausing, even if it is a year from now.

According to preliminary closing data, the Dow Jones Industrial Average rose 410.27 points, or 1.28%, to 32,411.52 points, while the S&P 500 gained 51.22 points, or 1.38%, to finish at 3,771.11 points. The Nasdaq Composite advanced 133.96 points, or 1.30%, to 10,476.90 points.

The report on job creation comes after a series of contradictory data this week that pointed to a slowdown in certain parts of the economy, but also underlined the resilience of the american labor market despite aggressive rate hikes to control inflation.

The market’s attention will now focus on next week’s inflation data, as well as on the legislative elections on November 8, in which control of the United States Congress is at stake.

Meanwhile, hopes of an easing of China’s tough COVID-19 restrictions supported some areas of the market, with shares of US-listed Chinese companies such as Alibaba and JD.com.

Those hopes also helped boost prices for commodities such as copper, which in turn helped lift the materials sector which was the best performer of the 11 major S&P sectors.

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