Stocks fell on another volatile day Friday as hopes for a US-China trade deal and a solid jobs report initially pushed the Dow higher but weren't enough to offset concerns about a lackluster holiday outlook from Apple.
The Dow dropped 110 points, or 0.4%. It had been down as much as 300 points earlier in the day. The S&P 500 finished Friday with a 0.6% loss as well.
But the Dow, S&P 500 and Nasdaq still all ended the week with gains of more than 2%.
Stocks rallied overseas after Bloomberg reported that President Donald Trump was asking cabinet members to begin drafting a possible trade deal with China. The Dow was up nearly 200 points Friday morning on that report too.
But Trump's National Economic Council director Larry Kudlow debunked that story on CNBC Friday, saying that "there's no massive movement" to do a deal with China.
Despite the conflicting reports about US trade talks with China, there was some good news from Washington — the strong October jobs report.
The US economy added 250,000 jobs last month and the unemployment rate held steady at 3.7%, the lowest level in nearly half a century. American workers had more good news too. Wages rose 3.1% from a year ago.
The uptick in wage growth may eventually spark more fears that the Federal Reserve will raise rates more aggressively in order to fight inflation. But investors seemed to be shrugging off those concerns Friday. Bond yields rose only slightly after the jobs report.
Tony Bedikian, managing director and head of global markets for Citizens Bank, said the jobs numbers were a "home run" and that he thinks investors are now looking at higher wages as a plus instead of fearing what they might mean for Fed rate hikes.
"The market is anticipating steady wage gains. They are healthy. Workers are able to spend more because they have more in their pocket," Bedikian said. "It's hard to find red flags in the jobs numbers."
In corporate news, the tech-heavy Nasdaq ended the day down 1%. That was largely due to the fact that Apple (AAPL) — which is also one of the Dow's biggest components — fell nearly 7% following its latest earnings report. Apple issued a somewhat tepid outlook for the next few months.
Chinese e-commerce giant Alibaba (BABA) dipped more than 2% despite beating earnings forecasts. But the company lowered its outlook for 2019, citing the uncertain state of the global economy.
WW (WTW), formerly known as Weight Watchers, plunged 30% after reporting it's losing subscribers. GoPro (GRPO) plummeted 24% on a poor holiday season forecast. And GE (GE) continued its slide, falling 3%.
But not all consumer companies were doing well. Macaroni and cheese and ketchup giant Kraft Heinz (KHC), which is a big stock holding of Warren Buffett's Berkshire Hathaway (BRKB), plunged 10% as its earnings were lower than expected.
- US economy adds 250,000 jobs in October
- The US economy added better-than-expected 250,000 jobs in October
- US economy added 155,000 jobs in November
- Decision could spell deportation for these 250,000 immigrants
- U.S. economy added 2 million jobs in 2017
- Gig economy jobs aren't really taking over America's workforce
- US employers add 228K jobs, unemployment rate stays 4.1 pct
- US Steel to add 300 jobs, citing steel tariffs
- Volkswagen will add 1,000 jobs at Tennessee plant
- Trump administration ended protected status for 250,000 Salvadorans. These immigrants might be next