S&P 500 closes slightly higher Friday, but major averages end 9-week win streak: Live updates

The S&P 500 ended Friday modestly higher, but all three of the major averages snapped a nine-week winning streak following a stronger-than-expected jobs report.

The broader index rose 0.18% to end at 4,697.24, while the Nasdaq Composite added 0.09% to finish at 14,524.07. The Dow Jones Industrial Average ticked higher by 25.77 points, or 0.07%, settling at 37,466.11.

The three major averages notched their first negative week in 10, with the Nasdaq suffering the biggest decline at 3.25% — its worst weekly performance since September. The S&P 500 and Dow dropped 1.52% and 0.59%, respectively.

Stocks gyrated on Friday as traders assessed incoming economic data to determine if and when the Federal Reserve will start cutting interest rates.

The U.S. economy added many more jobs than anticipated in December, with nonfarm payrolls growing by 216,000. Economists polled by Dow Jones expected a gain of 170,000 for last month. The unemployment rate held steady at 3.7% in another sign of continued labor strength.

The report sent Treasury yields spiking higher, with the benchmark 10-year rate touching a high of 4.103%.

A strong labor market could mean that the Fed might potentially delay the first of its rate cuts, which traders have been eagerly anticipating. Before the strong data hit Friday, traders were hoping the Fed would start cutting rates as early as March and lower them by as many as six times in 2024. Those expectations will need to be dialed back.

While December's ISM services index represented that business activity is still overall expanding in the economy, the reading of 50.6% was nearly two full percentage points below the Dow Jones consensus estimate of 52.5% and November's 52.7% level. A reading above 50% marks the threshold for economic growth.

"The job market is looking good — perhaps too good — and maybe inflation will be running a little hotter now based on the wage growth that we're seeing," Mike Bailey, director of research at FBB Capital Partners, told CNBC. "This sizzle we're getting in the job market might be pouring some cold water on hopes of a rapid string of rate cuts."

He added: "Coming into today, investors wanted three things: fading inflation, a stable job market and rate cuts. However, I think coming out of today's jobs number suggests to me that there's some give and take here, and investors might only be getting one out of the three items on their wish list."

The stock market surged to end 2023 as traders anticipated the Fed would pivot to easier monetary policy. The S&P 500's weekly winning streak to end the year was its longest in nearly two decades and brought the benchmark's gain for the year to 24%.

One other factor weighing on the market in the new year is the cooling off of large-cap tech stocks like Apple, which has been downgraded by two research shops this week. The iPhone maker tumbled 5.9% this week.

Stocks finish higher but snap 9-week winning streak

Stocks closed slightly higher to wrap up the first trading week of 2024, although all three major indexes notched their first weekly decline after nine straight weeks of gains.

The S&P 500 climbed 0.18% to end at 4,697.24, while the Nasdaq Composite advanced 0.09% to settle at 14,524.07. The Dow Jones industrial Average gained 25.77 points, or 0.07%, to close at 37,466.11.

— Lisa Kailai Han

Oil prices end the week higher on geopolitical risks

Oil prices ended the week higher on fears that the Israel-Hamas war could escalate into a regional conflict.

The West Texas Intermediate contract for February settled at $73.81 a barrel on Friday, up $2.16 or about 3% over the past week. The Brent contract for March settled at $78.76 a barrel, gaining $1.72 or 2.23% during the same period.

Traders have grown more concerned about mounting tensions in the Middle East after largely dismissing geopolitical since the Israel-Hamas war began.

Houthi militant attacks on vessels in the Red Sea have forced Maersk to stop shipping through the key waterway for the foreseeable future. The U.S. has threatened the militants, who are based in Yemen and allied with Iran, with consequence to no avail so far.

U.S. Secretary of State Antony Blinken is travelling in the region for the next week in an effort to prevent conflict from spreading.

A wider war that involves in Iran could lead to a disruption in the Strait of Hormuz, which would pose a major threat to oil flows, according to analysts.

— Spencer Kimball

Consumer staples, small-caps to outperform in 2024, says Wolfe Research

As consumer confidence softens this year, Wolfe Research's Chris Senyek favors consumer staples over their discretionary counterparts, he wrote in the firm's 2024 macro outlook.

Senyek also predicts that the "Magnificent 7" stocks will underperform in the new year. The seven tech titans led last year's gains.

Overall, small-cap stocks look cheap, with their discount close to all-time highs, but Senyek believes it's still too early to jump back in.

"We don't recommend rotating into small caps until the economic outlook bottoms," he wrote.

— Lisa Kailai Han

Verizon, Boeing, Home Depot are Dow's biggest gainers

Shares of Verizon, Boeing and Home Depot led the gains for the Dow Jones Industrial Average on Friday. The stocks were respectively up 2.3%, 1.8% and 1.2%.

Seven of the index's 30 stocks had gained 1% or more during Friday's trading session.

On the other hand, UnitedHealth Group, Proctor & Gamble and Walmart were the biggest losers, respectively sliding 1.3%, 1% and 0.9%.

— Lisa Kailai Han

Rates aren't the only factor behind the recent market selloff, UBS says

Interest rates have long been tied to the performance of the equity market, with many investors by extension attributing the recent stock selloff to the reversal in the Treasury market.

Naturally, the next question if how rates could further impact stocks this year. But UBS strategist Jonathan Golub believes that rates aren't the only factor investors should consider.

"The market appears to be much more sensitive to changes in risk metrics—such as high yield spreads and the Vix—than rates themselves," he wrote. "These relationships hold for both the S&P 500 and Nasdaq, but are more pronounced for the latter."

— Lisa Kailai Han

Oil prices rise as Blinken heads to Mideast to prevent wider war

Oil prices rose Friday as tensions in the Middle East continue to mount, with U.S. Secretary of State Antony Blinken heading to the region in an effort to prevent conflict from spreading.

The West Texas Intermediate contract for February gained $1.38, or 1.91%, to trade at $73.57 a barrel. The Brent contract for March rose $1.01, or 1.3%, to trade at $78.60 a barrel.

The Danish shipping giant Maersk said Friday that it will divert all of its ships away from the Red Sea for the "foreseeable future" as the "security risk continues to be at a significantly elevated level."

Houthi militants defied a U.S. warning to stop attacks in the Red Sea or face the consequences. The militants, based in Yemen and allied with Iran, detonated an unmanned surface vessel in the waterway on Thursday, according to the Pentagon.

— Spencer Kimball

Investors rotating back into growth and cyclical stocks upon strong jobs reports, says FBB Capital Market's Mike Bailey

Friday's strong December jobs report sparked fear within investors that the Federal Reserve wouldn't be immediately embarking upon a rapid string of rate cuts, according to Mike Bailey, director of research at FBB Capital.

Below the surface, Bailey said that growth and cyclical stocks were outperforming defensive sectors such as healthcare, consumer staples, REITs and utilities.

"What we're seeing is a bit of a rotation into some of the sectors that have been beaten up this week," he told CNBC. "The macro message is if a hot job market equals faster economic growth, you want to be buying growth and cyclicals — why would you want to own a defensive stock if the economy is roaring?"

— Lisa Kailai Han

All 3 major stock indexes set to snap nine-week winning streak

Stocks kicked off 2024 with a whimper, a stark contrast to the strong year-end rally that concluded 2023.

All three major indexes are on pace to snap their nine-week winning streaks. So far, the S&P 500 is set to end the week 1.4% down, while the Dow Jones Industrial Average is on pace for a 0.7% decline.

The Nasdaq Composite has been hit especially hard by the pullback in tech titans like Apple, which was downgraded by two firms this week. The tech-heavy composite is set to end the week nearly 3% in the red.

— Lisa Kailai Han

Peloton, Costco among Friday's biggest movers

These are some of the stocks making the biggest moves during midday trading:

• Peloton — Shares of the fitness company soared nearly 17%, after adding 14% in the prior session, on news of its partnership with TikTok.
• Costco Wholesale — Shares added 1.4% on Friday after Costco reported a whopping sales increase in December, posting on Thursday that its sales last month jumped 9.9% year-over-year to $26.15 billion, led by its e-commerce segment.
• Elanco Animal Health — The animal health stock rallied more than 9%. Stifel upgraded shares to buy from hold, citing a powerful pet health pipeline and opportunities for multiple expansion.

Read the full list of companies on the move here.

— Samantha Subin

7 S&P 500 stocks hit new 52-week highs

Seven stocks in the S&P 500 hit new 52-week highs during Friday's trading session. Of these names, two stocks hit new all-time highs.

Here's a look at the seven companies that reached this milestone:

• Hartford Financial
• Loews (all-time high)
• Bank of NY Mellon
• Synchrony Financial
• American Express
• JPMorgan (all-time high)
• Capital One

— Christopher Hayes, Lisa Kailai Han

Equities tend to do well in election years, Citi says

Another tailwind is expected to prop equities up this year — the upcoming U.S. presidential election, according to Citi.

Equities tend to perform even better in years when the incumbent president is running or a Republican candidate wins, analyst Alex Saunders added.

However, "there is a general pull back in the 2 months before, which is unwound in the week pre- and post-election," he wrote. "More relevant to this election, equities trade better into elections resulting in a divided government, and the underperformance into unified governments is reversed after the election."

Saunders added that financials generally outperform tech around election time. A Republican win tends to send aerospace and defense stocks higher, while oil and gas companies might see a small rally followed later by a reversal. A Democratic win, on the other hand, might be good news for healthcare stocks.

— Lisa Kailai Han

Cash attracts highest inflow for first week of year ever, Bank of America Securities says

Cash just notched its highest inflow for the first week of the year ever, according to Bank of America Securities.

The asset class attracted $123.1 billion in inflows this week, which was also the largest since March 2023, read a Thursday note from the firm. During that time, investors were contending with the regional banking crisis.

Meanwhile, stocks are off to a volatile start to 2024, with the S&P 500 looking to snap nine weeks of gains on Friday as investors trim profits after the recent rally.

— Sarah Min

December's ISM services index comes in below expectations

The ISM services index for December registered a reading of 50.6%, representing that business activity still seems to be overall expanding.

A reading above 50% represents growth.

However, December's level was nearly two full percentage points below the Dow Jones consensus estimate of 52.5% and November's reading of 52.7%.

— Lisa Kailai Han

Stocks open flat on Friday

Stocks opened flat to start Friday's trading session after a hotter-than-anticipated December jobs report spiked fears that the Federal Reserve might prolong the time until its first rate cut.

The S&P 500 and the Nasdaq Composite were both unchanged. The Dow Jones Industrial Average slid 39 points, or 0.1%.

— Lisa Kailai Han

Market now sees diminished odds of March Fed rate cut, per CME FedWatch

The December jobs report has pushed down the odds that the Federal Reserve will ease interest rate policy as early as March, according to the CME FedWatch tool that uses the actions of traders to analyze the probability of changes to U.S. monetary policy.

Odds of a quarter-point cut in the fed funds rate to 5.00-5.25% from the current 5.25-5.50% dropped to 53.6%, down from 62.3% Thursday and 73.4% one week ago, as implied by 30-day futures pricing data. Conversely, chances that rates will stay where they are in March climbed to 43.9% Friday from just 11.5% a week ago.

The Street now pencils in 46.3% odds that rates will move down a quarter point at the Fed's meeting in May, up from 11.3% a week ago, while the chance that rates will have come down a full half point by the end of the May meeting have dropped to 40.9% today from 71.9% last Friday.

— Scott Schnipper

These are the companies making the biggest premarket moves Friday

Check out the companies making headlines before the bell.

• Peloton — Shares of the fitness company provider jumped 3.8% on Friday, a day after Peloton announced that it is partnering with TikTok to bring short-form fitness videos to the social media platform. The partnership is an effort to boost subscribers and attract a wider pool of customers, as Peloton attempts to recover from falling sales and profits.
• Okta — The cybersecurity stock slumped 1.5% after Jefferies downgraded Okta to hold from buy on Friday, citing a recent security breach as added pressure on the stock. The firm is still positive on the overall strength of Okta.
• Costco Wholesale — Shares of the retail giant rose 0.6% after Costco said Thursday that December sales saw jumped 9.9% year-over-year to $26.15 billion, fueled by its e-commerce segment. Costco's total and comparable sales saw a 3% benefit from December's additional shopping day due to the timing of New Year's Day, the company said.

For the full list, read here.

— Pia Singh

December jobs report comes in much better than expected

The U.S. economy added many more jobs than anticipated in December, with nonfarm payrolls growing by 216,000. Economists polled by Dow Jones expected a gain of 170,000 for last month.

The unemployment rate held steady at 3.7%.

— Jeff Cox

Berkshire adds Liberty SiriusXM tracking stock in merger arb play

Berkshire Hathaway bought 2.8 million shares of the Liberty SiriusXM tracking stock (LSXMK) in a series of transactions Tuesday through Thursday at an average price of $29.76 per share, according to a regulatory filing.

Last month, Liberty Media announced that its Liberty Media's Liberty SiriusXM tracking stock group will combine with satellite radio company SiriusXM to create a new public company. The new company will trade on the Nasdaq under the ticker SIRI.

The recent purchase could be a merger arbitrage play to take advantage of Liberty Sirius' discount relative to the value of its stake in Sirius XM.

— Yun Li

Wolfe Research expects more dividend cuts in 2024 — but that's good news in the long run

Shares of Walgreens Boots Alliance fell more than 5% during Thursday's trading session after the company announced it would slash its quarterly dividend to 25 cents per share from 48 cents.

As economic growth slows this year, Wolfe Research's Chris Senyek expects to see more dividend cuts in 2024.

However, Senyek said that ultimately, in the long run cutting dividends could be beneficial for stock prices.

"Historically, we've found that the market prices in a cut in the 1-year period preceding the actual event as the historical total and relative average returns were -28% and -17%, respectively. Subsequently, the dividend cut has signaled a 'clearing event' for the stock," he wrote in a Friday note. "On average, across all dividend cut stocks, they were dead money for 6 months but then outperformed over the 1 and 2-year periods."

Senyek added that stocks within the industrials, energy and materials sectors tended to perform the best post-cut.

— Lisa Kailai Han

Maersk will divert vessels from Red Sea 'for the foreseeable future'

Maersk said Friday it will keep ships away from the Red Sea for the "foreseeable future."

"The situation is constantly evolving and remains highly volatile, and all available intelligence at hand confirms that the security risk continues to be at a significantly elevated level," Maersk said in a statement.

— Jenni Reid

Watch these S&P 500 levels as Wall Street struggles in early 2024, chart analyst says

Douglas Busch of ChartSmarter said the 4,600 level in the S&P 500 will be key if the broad market index continues its decline. However, he still sees the benchmark breaking above 5,000 in the first half of 2024.

"I think you just let things shake out. Be patient; no reason to be a hero" Busch told CNBC on Thursday.

Busch's comments came as the S&P 500 fell for a fourth straight day, putting it in jeopardy to snap a nine-week winning streak. The S&P 500 closed at 4,688.68 in the prior session. For the index to reach 5,000, it will need to rise 6.6%.

— Fred Imbert

Stock futures turn lower

Dow Jones Industrial Average futures were 0.16% down by 4:30 a.m. ET. S&P 500 futures slipped 0.16%, and Nasdaq 100 futures fell 0.22%.

It comes as Europe stocks started the day in the red and most Asian markets logged weekly losses.

— Katrina Bishop

Philippine December inflation hits near 2-year lows

Philippine Inflation in December cooled at a faster pace than the month before, according to official data.

Consumer prices rose 3.9% in December, lower than the 4.1% increase in the prior month. It was also the slowest pace of price increases since since February 2022, and the the third straight easing in CPI.

Inflation is still, however, higher than the Bangko Sentral ng Pilipinas' target range of 2%-4%.

"The downtrend in the overall inflation in December 2023 was primarily brought about by the lower year-on-year growth in the index of housing, water, electricity, gas and other fuels at 1.5 percent in December 2023 from 2.5 percent in the previous month," according to the official release.

—  Shreyashi Sanyal

Japan December composite PMI signals contraction in private sector activity is over

A survey showed on Friday that the contraction in Japan's private sector activity was over.

The au Jibun Bank Japan composite PMI for December came in at 50, rising from 49.6 in the prior month to signal stabilization in Japan's private sector output.

A PMI reading above 50 signifies expansion, while numbers below that show contraction.

December saw higher services sector growth, but manufacturing activity continued to slow.

The au Jibun Bank Japan services PMI was at 51.5 in December, up from 50.8 in November. The expansion was the second-weakest recorded in 2023.

"A faster rise in new business was a key factor in driving business activity growth higher, as firms cited increased customer numbers," the survey said.

Japan's Nikkei 225 index edged 0.3% higher on Friday.

— Shreyashi Sanyal

Peloton continues to surge after announcing TikTok partnership

Shares of Peloton rose 6% in after hours trading as investors continued to cheer the fitness company's new partnership with TikTok.

The collaboration includes a new fitness hub on the social media app, with content created by Peloton instructors.

The move builds on a gain of nearly 14% during Thursday's regular trading session.

— Jesse Pound

Stock futures open slightly higher Thursday night

U.S. stock futures ticked higher on Thursday evening.

Futures linked to the S&P 500 gained 0.1%, as did futures tied to the Nasdaq 100. Dow Jones Industrial Average futures added 53 points, or about 0.1%.

The three major averages are all on pace for weekly losses.

— Darla Mercado

Major averages poised to snap win streak

Here's where the major averages stand for the week with one session left:

• The Dow is down -0.66% WTD, on pace to break a 9-week win streak
• The S&P 500 is down -1.70% WTD, on pace to break a 9-week win streak
• The S&P 500 has fallen for four straight sessions for the first time since its 5-day streak ending Oct. 23, 2023
• The Nasdaq is down -3.34% WTD, on pace to break a 9-week win streak with its worst weekly performance since the period ending September 2023.
• The Nasdaq suffered its fifth negative session in a row for the first time since its 6-day streak ending Oct. 12, 2022.

— Jesse Pound, Christopher Hayes