Stock Market Today: ​Stocks Rise as Weak Jobs Data Fuels Rate-Cut Bets and Fed Scrutiny

U.S. stocks traded higher on Thursday, as investors digested fresh labor market data and monitored developments at the Federal Reserve. The tech-heavy Nasdaq Composite (IXIC) rose 0.3%, while the S&P 500 (GSPC) added 0.4%. The Dow Jones Industrial Average (DJI) climbed 0.4%, marking a broadly positive day across major indices.

The gains come as weak private sector job growth in August helped restoke expectations for potential Federal Reserve rate cuts. Meanwhile, Washington remained in focus with a Senate hearing to confirm Stephen Miran, highlighting questions about central bank independence amid shifting economic conditions.

​Market Movers:

• Google (GOOGL) +2.5%: Alphabet climbed after investors shrugged off lingering antitrust concerns, focusing instead on strong advertising trends and its continued growth in AI-driven search products. Analysts noted that a lack of new regulatory restrictions on Chrome has reassured investors about Alphabet’s near-term revenue stability.
• Lululemon (LULU) +1.8%: Lululemon surged, benefitting from renewed optimism in consumer spending and a solid earnings outlook, particularly as athleisure trends remain strong. Investors are encouraged by the company’s expansion into international markets and its resilient margins despite broader economic uncertainty.
• Broadcom (AVGO) +0.7%: Shares of Broadcom rose on expectations of strong demand for semiconductors in data centers and AI hardware. Analysts highlighted Broadcom’s ability to navigate global supply chain pressures while maintaining high margins, making it a defensive play in the tech sector.
• ADP (ADP) +0.74%: The payroll processor rose slightly following its own jobs data release, which showed weaker-than-expected private sector growth. Investors interpreted this as a signal that labor market pressures may ease, increasing the likelihood of accommodative Fed policy.

Labor Market Data and Investor Sentiment

The ADP report revealed that U.S. private payrolls increased by 54,000 in August, below the 65,000 estimate. Weekly jobless claims also rose to their highest level since June, reflecting ongoing uncertainty in the labor market. This weaker employment growth has reignited speculation that the Fed may lower interest rates sooner than expected to support economic activity. While unemployment remains near historically low levels, investors are weighing the implications of slowing hiring and a cooling labor market on consumer spending and corporate profits.

Federal Reserve Oversight in Focus

Thursday’s Senate hearing to confirm Stephen Miran as a key Fed official drew attention to questions surrounding central bank independence. Markets are increasingly sensitive to any comments that could suggest political pressure on monetary policy decisions. Analysts noted that while Fed officials remain committed to their dual mandate of inflation control and employment, rate-cut expectations are likely to rise if job growth continues to soften. This dynamic adds a layer of complexity for investors balancing equity and fixed-income strategies.

Looking Ahead

Investors will be watching Friday’s official nonfarm payrolls report for August, which will provide a more complete picture of the U.S. labor market. Investors are expected to interpret the data as a signal for potential interest rate cuts and to gauge the health of consumer spending heading into the fall. The tech and consumer discretionary sectors could see continued volatility, depending on how labor market data influences expectations for Fed policy. Meanwhile, any further commentary from central bank officials or congressional hearings could sway markets in the short term, keeping investors alert to policy-driven movements.