S&P 500 Hits Record as Surprise July Job Losses Calm Rate Fears

Stocks closed higher Friday after a surprisingly weak July jobs report reinforced expectations that the Federal Reserve can keep interest rates on hold. The S&P 500 advanced 0.62% to a record close of 7,757.64, the Nasdaq Composite climbed 1.3% to 26,690.62, and the Dow Jones Industrial Average added 151.83 points, or 0.28%, to finish at 54,036.93.

The Bureau of Labor Statistics reported that nonfarm payrolls fell by 23,000 in July, well below the 83,000 gain economists had expected. The unemployment rate edged down to 4.1% as labor force participation dropped to 61.4%, its lowest level in more than five years.

Traders interpreted the soft print as a sign the Fed won't need to tighten policy soon, capping a second straight winning week that saw the S&P 500 gain 3.6%. The rebound follows Thursday's 464-point Dow drop, which had been driven by rising oil prices ahead of the report.