Stock Market Today: Weak Jobs Report Lifts Stocks as Fed Rate-Hike Bets Fade, Nasdaq and Dow Rally – Eurasia Business News

By William Collins, consultant in stock markets – Eurasia Business News, October 2, 2026. Article no 3191

U.S. stocks rallied on Friday, October 2, after a weaker-than-expected September jobs report eased fears that the Federal Reserve would need to raise interest rates again this month. The Nasdaq Composite rose 1.2% and reached a fresh intraday record, while the Dow Jones Industrial Average gained 0.5% and the S&P 500 added 0.7%.

The employment report delivered the kind of result markets often welcome: clear evidence of slowing hiring, but not a dramatic deterioration in the labor market. That combination encouraged investors to reduce bets on another immediate Fed rate increase, even as Treasury yields reversed their early declines and finished higher.

September Jobs Report Misses Expectations

U.S. nonfarm payrolls increased by just 29,000 in September, far below economists’ forecasts of about 85,000 to 90,000. The report also revised August employment growth down to 133,000 from an earlier estimate of 162,000. The unemployment rate rose to 4.2% from 4.1% in August.

The data signaled that the labor market is losing momentum after a long period of resilience. While 29,000 new jobs is not a contraction, it suggests that employers are becoming more cautious about hiring as borrowing costs remain high and the outlook for energy prices and global growth stays uncertain.

The report also included downward revisions to July and August payroll figures, reinforcing concern that job creation has been softer than previously thought. Peter Schiff, chief economist at Europac, argued that the numbers point to a weak labor market combined with high inflation—a difficult combination for policymakers.

Fed Rate-Hike Expectations Decline

Before the report, traders had been concerned that strong hiring and high oil prices might force the Fed to follow September’s quarter-point increase with another hike in October. After the weaker payroll reading, market pricing shifted decisively toward a pause.

Traders now assign roughly a 21% to 22% probability of a 25-basis-point rate increase this month, compared with about 70% earlier in the week. The decline reflects the view that slower hiring gives the Federal Reserve more time to assess incoming inflation and growth data.

The policy outlook remains complicated. Inflation is still above the Fed’s 2% target, energy prices have stayed elevated and long-term Treasury yields are near levels last seen in 2002. But Friday’s report reduced the risk of an immediate acceleration in Fed tightening.

Nasdaq Leads Wall Street Higher

The technology-heavy Nasdaq Composite rose 1.2%, reaching an intraday record before finishing slightly below its peak. The S&P 500 gained 0.7%, and the Dow added 0.5% as 10 of the 11 major S&P sectors closed in positive territory.

Consumer-discretionary stocks led the advance, while healthcare was the only sector to finish lower. The Russell 2000 also ended the week in positive territory, a development that suggested investors were willing to buy smaller, rate-sensitive companies after the payroll report eased immediate policy concerns.

ON Semiconductor rose 5.8%, while Seagate Technology fell 10.2%. Technology stocks benefited from the prospect of a less aggressive Fed, since lower expected rates tend to support the valuations of companies whose earnings are concentrated further into the future.

Alex King of Cestrian Capital Research said the Nasdaq’s new all-time high, together with gains in the Russell 2000, suggests markets may be anticipating a future reversal in Treasury yields. That view remains speculative, however, because yields finished the day higher despite the softer labor data.

Treasury Yields Reverse Higher

Treasury yields initially fell after the payroll release, with the 10-year yield briefly dropping below 5.17%. But the decline did not hold. By the close, the two-year Treasury yield had risen roughly 4 basis points to 4.83%, the 10-year yield climbed about 3 basis points to 5.28%, and the 30-year yield gained 2 basis points to 5.62%.

The reversal showed that long-term bond investors remain focused on inflation, oil prices and heavy government borrowing. Even if the Fed pauses in October, markets may still demand higher yields to hold long-dated debt.

France remained a source of concern in European bond markets. French two-year yields rose to their highest level since 2008, widening the gap against German debt as investors questioned Paris’s fiscal outlook and the political viability of its 2027 budget plan.

Oil Prices Ease

Oil prices fell as reports pointed to potential releases of diesel and crude stocks in Europe, easing concern about tight global energy supplies. Brent crude settled down 6 cents, or 0.06%, at $102.25 a barrel. U.S. West Texas Intermediate crude fell $1.76, or 1.90%, to settle at $91.11.

Lower oil prices supported the stock-market rally by reducing immediate inflation anxiety. However, Brent above $100 remains high enough to put pressure on fuel costs, transport companies and consumer budgets.

Gold Price Falls 0.96%

Gold prices fell on October 2 after an early rally faded. The screenshot shows spot gold trading near $4,136.10 per ounce at 4:46 p.m. New York time, down $40.00, or 0.96%, on the session. The metal traded between roughly $4,124.50 and $4,226.20 per ounce during the day. The price per gram was $132.98, while the kilogram quote stood near $132,980.74.

Read also : Gold : Build Your Wealth and Freedom

Gold initially benefited from weak payroll data and lower rate-hike expectations, but elevated Treasury yields and a firm dollar later pressured non-yielding bullion. Reuters reported spot gold near $4,140.06 in afternoon trading.

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© Copyright 2026 – Eurasia Business News. Article no. 3190