Jobs day: yields back off a 24-year high, Nike sinks late

The September jobs report arrives at 8:30 a.m. ET, one day after the 10-year Treasury yield touched its highest level since 2002 and then backed off. Stocks ended Thursday barely changed, but that calm hid some very large single-stock moves, and Nike fell hard after the close.

Yields hit a 24-year high, then retreated

The 10-year Treasury yield climbed as high as 5.344% on Thursday, its highest since April 2002, before buyers came back and it closed near 5.24%, about 5 basis points lower on the day, per HDFC Sky’s market wrap and Reuters. The 2-year yield fell 10 basis points to about 4.79%, and the 30-year ended near 5.61%.

Stocks followed the bond market. They were lower while yields were climbing and recovered as yields eased. The S&P 500 rose 0.19% to 7,666.45, the Dow added 20.51 points to 50,926.56 and the Nasdaq Composite gained 0.04% to 26,871.60, per Yahoo Finance.

The day’s economic data did not argue for lower rates. Initial jobless claims fell to 197,000 for the week ended September 26, a fourth straight weekly decline. The ISM manufacturing index was 54.5 in September, nearly unchanged from 54.6, but its prices-paid measure jumped 6.8 points to 77.9, a sign that factories are paying more for materials. That is the detail that disagrees with Wednesday’s cooler inflation report, and it is worth keeping in mind: consumer inflation eased in August, while manufacturers reported sharply rising costs in September.

Oil is part of that picture. Brent crude settled up 4.4% at $102.35 a barrel after reports that the US is sending more troops and an aircraft carrier to the Middle East, and after China suspended exports of oil products, per Reuters.

A flat index hid some very large moves

In our feed, 55 of the 100 stocks and funds we track rose. The other 45 lost ground. The S&P 500 fund SPY rose 0.18%, the Nasdaq-100 fund QQQ 0.31% and the small-cap fund IWM 0.41%, while the Dow fund DIA was flat, up 0.01%.

The biggest stories were outside the usual megacaps:

Accenture (ACN) rose 15.82% to $212.54 after reporting fiscal fourth-quarter earnings of $3.29 a share and revenue of $18.7 billion, up 6.3% from a year earlier, both ahead of estimates, per GuruFocus. It traded as high as $227.63 during the day. Other consulting and IT-services names rose with it: Concentrix gained 8.30%, Kyndryl 7.82% and Huron Consulting 7.64%, and IBM rose 2.59%.
Mattel (MAT) jumped 18.86% to $15.03 after reports that Authentic Brands Group has discussed an offer that could value the toymaker at more than $20 a share, or roughly $6 billion, per CNBC and Yahoo Finance. No formal sale process is underway, and the reports are not a confirmed bid.
Synopsys (SNPS) rose 12.80% to $490.74 after announcing, at its investor day, a multiyear agreement with Amazon Web Services worth more than $1 billion and a partnership with OpenAI, per TheStreet.

Energy followed oil higher: the sector fund XLE rose 1.95%, and Chevron (CVX) gained 1.42%.

Health care was the weak spot for a second day. The sector fund XLV fell 1.32%, Thermo Fisher (TMO) fell 3.34%, Johnson & Johnson (JNJ) 2.30% and Abbott (ABT) 2.17%. Smaller biotech names were hit harder, with Nektar Therapeutics down 22.31% and Repligen down 7.78%. We could not confirm a single cause for the group’s decline.

Disney (DIS) fell 3.40% to $101.33; Benzinga tied the pressure to recently reported layoffs. Alphabet (GOOGL) opened about 2% higher and reversed to close down 1.70% at $338.24.

Chips: Micron reversed, and the suppliers rallied

Micron’s first full session after its record quarter was a round trip. The stock fell as low as $1,022.90, about 4% below Wednesday’s close, and then finished at $1,097.39. In our feed Micron (MU) closed up 3.03%, and its last after-hours print was $1,090.20.

The companies that sell into the AI build-out did better still. Applied Materials (AMAT) rose 3.50%. Among optical and networking suppliers, Coherent gained 10.94%, Credo 7.85%, Ciena 7.82% and Lumentum 7.63%. The Philadelphia Semiconductor Index rose 1.59%, per HDFC Sky. Nvidia (NVDA) rose 1.09%, while Broadcom (AVGO) fell 2.15%.

Software added to Wednesday’s gains, with Salesforce (CRM) up 3.10% and ServiceNow up 2.80%.

Nike: a profit beat, and a steep drop after hours

Nike reported after the close. Earnings of $0.48 a share were ahead of the $0.44 analysts were looking for, but revenue fell 4% to $11.2 billion, short of the $11.33 billion consensus. Sales in Greater China dropped 26%, and the company said it sees full-year revenue declining by a high-single-digit percentage, per Nike’s earnings release and FinanceFeeds.

The stock had closed the regular session at $35.15. Our feed shows it at $32.09 after hours, down about 8.7% from the $35.15 close, on roughly 3.2 million shares of late trading.

Overnight

Asian markets were mostly lower. Japan’s Nikkei 225 fell about 1%, though it is still up for the week, and Hong Kong’s Hang Seng slid 2.6% on its return from the holiday, per Reuters. MSCI’s index of Asia-Pacific shares outside Japan fell 0.3%.

Europe has its own bond problem. The gap between French and German government bond yields widened past 140 basis points, the widest since 2012, and the euro fell to about $1.1250. The STOXX 600 rose 0.2% in early trading but is on course for its worst week since mid-April, with a loss of nearly 2%, per Investing.com.

The 10-year Treasury yield was near 5.25% overnight, and WTI crude was at $92.46 a barrel after rising nearly 3% on Thursday, per Reuters. S&P 500 futures were up 0.3% and Nasdaq futures up 0.5%. Pre-market trading in our feed is still too thin to read anything into.

What to watch today

The September jobs report at 8:30 a.m. ET. Economists polled by Reuters look for 90,000 jobs added and an unemployment rate holding at 4.1%. August was first reported at 162,000.
Revisions to the August payroll figure, published in the same report.
Factory orders for August at 10:00 a.m. ET.
The 10-year Treasury yield, which closed Thursday near 5.24% after touching 5.344%.
Nike’s first regular session since its results, after shares traded at $32.09 late Thursday.
Brent crude, which settled Thursday at $102.35 a barrel.
The Fed’s next meeting is October 27-28. Futures put the chance of a rate increase there at about 28%, per CME FedWatch figures cited by Reuters.

Not financial advice. iTrading Buddy summarizes publicly available market data and news; every figure above is sourced from the reporting available before the US open on the date shown. Verify anything you act on.