S&P 500, Nasdaq, Dow make a U-turn lower after jobs report shows dramatic slowdown

US stocks reversed course sharply on Friday as investors took in a softer-than-expected jobs report, with imminent interest-rate cuts seen as certain after this week's run of weak labor data.

The S&P 500 (^GSPC) fell 0.7%, backing off the all-time closing high hit on Thursday, while the Dow Jones Industrial Average (^DJI) lost 0.8%. The tech-heavy Nasdaq Composite (^IXIC) slid roughly 0.6%. The declines mark a pullback from sizable gains earlier in the session.

The US economy added just 22,000 jobs in August, according to the Bureau of Labor Statistics. That was far short of expectations for 75,000 and adds more evidence to the narrative of a dramatically slowing US labor market. The unemployment rate rose to 4.3%, compared with 4.2% the previous month.

Revisions to data from July and June in Friday's report suggest that over the last three months, the US economy has created fewer than 30,000 new jobs. The revisions also showed a negative print in June, the first labor market shrinkage since 2020.

The jobs report, the first since President Trump fired the head of the BLS, capped a week of data showing cracks in the labor market. That has fed Wall Street's certainty that a rate cut is coming at the Federal Reserve's September meeting. Traders are now pricing in a 100% chance of a reduction, and bets are rising on a “jumbo,” 50-basis-point cut.

Treasury yields sank following the report, with the 30-year yield (^TYX) falling below 4.79% after nearing 5% earlier in the week. The benchmark 10-year yield (^TNX) dropped to 4.07%, its lowest since April.

After the release, Trump voiced further criticism of Fed Chair Jerome Powell in a social media post. “Jerome ‘Too Late' Powell should have lowered rates long ago. As usual, he’s ‘Too Late!'” he wrote. His comment comes a day after a Senate hearing to confirm Trump pick Stephen Miran as Fed governor, as the White House tries to recast the Fed in pursuit of rate cuts.

Meanwhile, AI trade hopes got a boost after an upbeat outlook from Broadcom (AVGO) and a report that the US company has signed a deal to build OpenAI's (OPAI.PVT) first chips. Its shares jumped over 10%.

Elsewhere in tech, shares of Tesla (TSLA) rose after the EV maker's board proposed paying CEO Elon Musk $1 trillion in compensation, if performance targets are met.

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Tesla stock jumps amid Musk's $1 trillion pay package proposal

Tesla stock jumped as much as 4.9% Friday after the EV maker's board proposed a plan, outlined in a filing to the US Securities and Exchange Commission, to compensate CEO Elon Musk with a pay package worth roughly $1 trillion if he achieves certain milestones.

Those milestones include driving Tesla's market cap to $8.5 trillion and putting 1 million of its Robotaxis into commercial operation.

This pay package would provide Musk with an additional 423 million shares of common stock, or 12% of Tesla shares, meaning he would have roughly 25% voting power over the company's decisions, noted Wedbush analyst Dan Ives in a note to clients Friday.

Ives believes the added voting power provision “was critical to keep Musk at the helm to lead Tesla through the most critical time in the company’s history.”

“We believe this was the smart move by the Board as the biggest asset for Tesla is Musk,” he said, adding, “[T]his is a crucial time for Tesla ahead with autonomous and robotics front and center.”

The stock pared gains shortly after the market open, up more than 2% mid morning.
Tech leads stocks higher at the open

US stocks jumped at the open on Friday as investors digested a weak August jobs report, which pushed investor confidence in a rate cut at the Fed's September meeting even higher.

The S&P 500 (^GSPC) gained 0.4%, coming off a fresh all-time closing high for the index on Thursday. The Dow Jones Industrial Average (^DJI) rose 0.2%, and the Nasdaq Composite (^IXIC) gained 0.6%.

Tech stocks' surge was led by gains in Tesla (TSLA) and Broadcom (AVGO) shares, which added 3.6% and 12.8% at the start of Friday's trading session.
Rate cut bets surge after jobs report

Bets on coming Fed rate cuts are surging after the jobs report.

CME Group had the odds of a cut very high before the report — around 97% to 3%. But after it confirmed the severe summer slowdown, the odds almost immediately shifted to 100% on a 25-point cut this month.

Subsequently, traders piled into bets on a “jumbo” rate cut — 50 basis points. As of around 9:10 a.m. ET, about 88% of bets are on a 25-point cut, and 12% of bets are for 50 points.

Bets are also jumping on cuts in October and December. By the end of the year, a majority of traders expect the equivalent of three rate cuts.
The first negative jobs print since 2020

The revisions to the monthly jobs report have taken high focus lately. On Friday, we learned something very noteworthy from them: June 2025 was the first month of labor market shrinkage since 2020.

June's number was revised to show a net loss of 13,000 jobs. That's the first negative monthly jobs print since December 2020, in the throes of the COVID-19 pandemic.

As my colleague Jake Conley notes, this report's revisions found that, over the last three months, the US economy added 8,000 fewer jobs per month than had been previously reported.

You can see the slight dip in the chart below:
US economy adds just 22,000 jobs, unemployment rate rises

The US labor market continues to slow.

The August jobs report released Friday by the the Bureau of Labor Statistics (BLS) showed there were just 22,000 new jobs added to the economy last month, far fewer than forecast and the latest sign that the US labor market slowed down through the summer. The unemployment rate rose to 4.3% in August.

Economists had expected the report to show 75,000 jobs created last month, with the unemployment rate forecast to rise to 4.3%, according to Bloomberg data.

In July, the economy created 73,000 new jobs. Those figures were revised on Friday to show 79,000 jobs created during the month. Revisions to June's data, however, were more negative, with those numbers now showing 13,000 jobs lost during the month. Revisions in early August had brought June's job growth down to 14,000.

Read more here.
Good morning. Here's what's happening today.
Broadcom jumps on sales outlook boost, amid buzz over OpenAI deal report

Broadcom (AVGO) is riding higher on a wave of AI optimism before the bell, with shares up around 8% as investors welcome an upbeat outlook and a Financial Times report that the US chipmaker has signed a big deal with (OPAI.PVT).

Reuters reports:

The firm, one of the world's most valuable chipmakers, has become a key player in the generative AI boom by designing custom semiconductors for cloud giants seeking alternatives to Nvidia‘s GPUs.

The company on Thursday said it has secured over $10 billion in AI infrastructure orders from a new customer, with [CEO Hock] Tan forecasting “significantly improved” AI revenue growth in fiscal year 2026.

Investors have bet big on AI-driven chipmakers, and have propelled Broadcom's shares nearly 32% higher so far this year, after the company's valuation crossed $1 trillion in December.

The timing of Broadcom's latest $10 billion AI deal has fueled speculation that OpenAI is the unnamed customer, following a Financial Times report on Thursday that the ChatGPT maker is working with Broadcom to develop its own custom AI chips.

Read more here. Premium members can read the full FT report here.
Premarket trending tickers: Broadcom, DocuSign and lululemon

Here's a look at some of the top stocks trending in premarket trading:

Broadcom (AVGO) stock rose 8% before the bell on Friday after a upbeat outlook for artificial intelligence revenue and CEO Hock Tan's pledge to stay on for five more years reassured investors.

DocuSign (DOCU) stock rose 8% in premarket trading on Friday reported an earnings beat and revenue outlook raise on Thursday.

lululemon (LULU) stock slumped on Friday in premarket trading after slashing its annual profit and sales forecasts, hurt by tepid
August jobs report to show ‘softness growing'

After a run of disappointing job market readings this week, the BLS will release the August nonfarm-payrolls report at 8:30 a.m. ET today.

The data is expected to confirm that the US labor market is weakening. That will feed into Federal Reserve policy thinking amid widespread certainty that a rate cut is coming in September.

Yahoo Finance's Jake Conley reports:

Read more here.
Lululemon shares are getting a pounding

Lululemon (LULU) stock is taking a pounding in premarket post-earnings, as it should.

The quarter and outlook both stunk. The results are deserved, as people I talk to in retail have been super let down in Lululemon's product assortments in recent months. It will take time to reverse the lack of must-have items, they say.

Here is the Street vibe on Lululemon this morning:

“Challenges from domestic market pressures and removal of the de minimis exemption are primary drivers of a meaningful cut to FY25 guidance (implying -4.4% lower 2H revenue and -22% lower 2H EPS at the midpoint). Acknowledgment of underperformance within the casual side of the business (40% revenue mix) is a starting point, though reigniting brand momentum in the U.S. is likely to take longer than we had previously anticipated.” — Stifel analyst Peter McGoldrick

“It's very simple… With sales per foot 4x mall avg and margins near peak, LULU's fundamentals will get much worse ahead. The US drives the earnings and the US is fading fast here. We believe the guide is not low enough and continue to carry estimates well below the Street/company guide. Rising competition won't stop either, which means LULU's EPS is permanently impaired. With lower growth and brand strength fading, a lower multiple is warranted.” — Jefferies analyst Randy Konik
Gold stays high after reaching record price

Gold (GC=F) has maintained its upward trajectory for a third week of consecutive gains. After hitting a record high this week, the price of the precious metal has held strong, buoyed by weaker-than-expected jobs data and fears around the Fed's independence.

Bloomberg reports:

Read more here.

Correction: A previous version of this article stated that Tesla added a new CEO. Tesla is proposing a new pay package for its CEO. We regret the error.