Editor’s Note: This article was updated with additional content.
The U.S. economy added 165,000 jobs in October, well above the 65,000 economists had expected, the Bureau of Labor Statistics said Friday. Private payrolls rose by 159,000, far above the 64,000 forecast, while government payrolls added 6,000 after shedding 18,000 in September.
The unemployment rate fell to 4.1%, compared with a 4.2% forecast.
Average hourly earnings rose 0.4% from September and 3.1% from a year earlier, against expectations of 0.3% and 2.9%.
The data follows Thursday’s tech bloodbath, with the Nasdaq 100, tracked by the Invesco QQQ Trust (NASDAQ:QQQ), tumbling 6.4% in its worst day since March 2020.
Overall, about $3.1 trillion in market value vanished from S&P 500 companies, with Nvidia Corp. (NASDAQ:NVDA) alone burning about $447 billion.
Revisions Add 84,000 Jobs to the Summer
The picture of the previous two months also got brighter.
August payrolls were revised up to 186,000 from 133,000, while September was lifted to 60,000 from 29,000.
Combined, the two months now show 84,000 more jobs than previously reported.
The labor force participation rate rose to 61.9% from 61.8%. The broader U-6 underemployment rate, however, climbed to 7.9% from 7.6%.
Business Services and Health Care Led Hiring
Professional and business services added 70,000 jobs, the largest gain of any sector. Professional and technical services contributed 33,000 and administrative and support services 28,000.
Health care added 42,000 jobs, led by hospitals with 16,000 and home health care services with 11,000.
Transportation and warehousing added 25,000 positions, including 17,000 couriers and messengers. Manufacturing added 19,000, with computer and electronic products up 7,000.
Construction, retail trade, financial activities, information, leisure and hospitality and government showed little change. No major industry posted a significant job loss in October.
Traders Now See a December Hike as the Base Case
Stronger hiring and firmer wages give the Federal Reserve more room to tighten policy.
On Polymarket, traders priced an 80% chance of a 25-basis-point rate hike at the Fed’s December meeting, compared with 21% for no change.
Bonds sold off after the release, led by short-dated Treasuries.
The two-year yield rose 5 basis points to 4.52%. The 10-year yield climbed 3.5 basis points to 4.88%, while the 30-year yield added nearly 3 basis points to 5.29%.
The dollar index rose 0.6% to 102.14.
Chipmakers Lead the Premarket Rebound
Nasdaq 100 futures rose 1.6% and S&P 500 futures gained 0.2%. Russell 2000 futures added 0.4%, while Dow futures fell 0.9%.
Among the 100 largest S&P 500 companies, the chip stocks hit hardest on Thursday led the bounce.
Lam Research Corp. (NASDAQ:LRCX) jumped 11.7% in premarket trading after the company announced a $25 billion share repurchase authorization late Thursday. The stock had dropped 16.4% in the previous session.
Dell Technologies Inc. (NYSE:DELL) rose 7.9%, Applied Materials Inc. (NASDAQ:AMAT) gained 7.8% and Advanced Micro Devices Inc. (NASDAQ:AMD) advanced 7.7%.
Micron Technology Inc. (NASDAQ:MU) added 7.1%, recovering part of Thursday’s 17.5% slide. Nvidia rose 4.1% to $189.12.
Gold fell 1% to $4,071.50 an ounce and silver slipped 0.3% to $52.20. Bitcoin (CRYPTO: BTC) fell 0.5% to $75,636.
This is a developing story.