Nasdaq 100 sets record close; Dow, S&P 500 gain on weak jobs report

On Friday, U.S. equities ended the session in positive territory, and the Nasdaq 100 registered a record close. The Nasdaq Composite posted the largest gain among the main benchmarks, rising 1.19%, though after hitting an intraday all-time high it finished just beneath that mark. The S&P 500 also advanced, but it remains roughly 1% below its record closing level.

The September jobs data provided a boost for buyers. Nonfarm payrolls increased by only 29,000, missing the 90,000 consensus estimate, which allayed worries about an imminent Federal Reserve rate increase. For equity markets, the focus was on the possibility of reduced further tightening, despite the slower hiring raising growth concerns.

Friday's advance helped offset some losses from earlier in the week. Still, the weekly performance revealed a split: the Nasdaq benchmarks ended the week in positive territory, whereas the Dow Jones Industrial Average, S&P 500 and Russell 2000 finished lower.

The closing numbers

• The Dow Industrial Average climbed 250.00 points (0.49%) to 51,182.11.
• The S&P 500 added 56.25 points (0.73%) to end at 7,722.71.
• The Nasdaq Composite rose 319.27 points (1.19%) to 27,190.86.
• The Russell 2000 gained 26.27 points (0.94%) to 2,832.90.
• The Nasdaq 100 increased by 306.37 points (1.00%) to a record close of 30,807.93.

For the week

• The Dow Industrial Average fell 1.26%.
• The S&P 500 dropped 0.26%.
• The Nasdaq Composite advanced 0.45%.
• The Russell 2000 declined 0.16%.
• The Nasdaq 100 gained 0.65%.

The Dow performed better on Friday, but the bulls still have more to accomplish. Its 1.26% weekly drop was the steepest among the five benchmarks. The S&P 500 and Russell 2000 nearly wiped out their weekly declines, but both ended the week in negative territory.

The Nasdaq benchmarks managed to finish the week higher. Nvidia closed near its record high, bolstering the technology narrative, as the stock also reached a new intraday all-time high, and the Nasdaq 100 further cemented its leading position. Friday's rise was broad across the main indexes, yet the weekly results still tilted in favor of tech.

A lesson for traders

A powerful single session and a powerful week convey different narratives. On Friday, buyers gained more control, but that did not erase the weekly declines seen across most of the market.

Similarly, a closing record is a positive signal, but market participants still require confirmation of continued strength. Can buyers maintain the upward momentum and draw in buying during pullbacks? Or will the breakout run out of steam and drop back below the previous high? The capacity to surpass a level and hold above it helps distinguish a sustained breakout from a false breakout.