Investing.com -- The Dow closed at fresh record highs on Friday as a stronger-than-expected jobs report underscored the strength in the U.S. economy, blunting worries about a potential recession.
By 4:00 p.m. ET (2000 GMT), the Dow Jones Industrial Average rose 341 points, or 0.8% to a closing record of 42,352.75. The S&P 500 closed 0.9% higher and NASDAQ Composite added 1.2%.
Strong nonfarm payrolls eases recession concerns, but hopes fall for big November rate cut
US employment growth was far stronger than expected in September, with nonfarm payrolls rising by 254,000 jobs last month, increasing from an upwardly-revised mark of 159,000 in August. Economists had anticipated a reading of 147,000.
The jobless rate also slowed to 4.1% from the prior month's 4.2%.
The healthy jobs market eased concerns about an economic slowdown, but also blunted the prospect of another jumbo interest rate cut at the Federal Reserve's November meeting.
"With broad reacceleration, we continue to expect 25bp rate cuts at the November and December FOMC meetings," Morgan Stanley said in a Friday note.
Chicago Fed president Austan Goolsee described the jobs report as "superb," and said it was still appropriate for the Fed to bring interest rates down a "a lot" over the next 12 to 18 months.
Spirit Airlines slumps on bankruptcy fears; Rivian slides after guidance cut
In the corporate sector, Spirit Airlines (NYSE:SAVE) stock slumped 25% after Bloomberg reported the carrier’s attempts to restructure its debt and avoid filing for bankruptcy have hit a snag after talks with bondholders failed to result in a deal.
Rivian Automotive (NASDAQ:RIVN) stock fell more than 3% after the EV manufacturer slashed its full-year production forecast and delivered fewer vehicles in the third quarter than expected, as the startup grappled with a parts shortage.
Elsewhere, the strike by US dockworkers looks set to end after their union and the group representing large ocean shipping firms reached an agreement, which is expected to result in a wage hike of roughly 62% over six years.
Ubisoft Entertainment (EPA:UBIP) jumped more than 33% after Bloomberg reported that Tencent (HK:0700) and the latter's founding family Guillemot are mulling a potential offer for the fresh video game maker.
(Peter Nurse contributed to this report.)