Friday, October 2, 2026
Stocks Edge Up as the 10-Year Yield Retreats From a 24-Year High; Jobs Report Misses Badly
Key Indicators
S&P 500
7,666.45
+0.19% (up)Nasdaq Composite
26,871.60
+0.04% (up)Dow Jones Industrial Average
50,926.56
+0.04% (up)10-Year Treasury Yield
5.24%
-0.06 pts (down)VIX
16.39
+0.05 (up)WTI Crude Oil
$92.91
+2.75% (up)Market Recap
Stocks Claw Back Early Losses on the First Day of October
US stocks recovered from a rough morning to finish slightly higher on Thursday. The S&P 500 rose 0.19% to 7,666.45, the Nasdaq Composite gained 0.04% to 26,871.60, and the Dow Jones Industrial Average added 20.51 points, or 0.04%, to 50,926.56. Growth and small caps finished ahead of value. The VIX closed at 16.39. US markets are open today.
10-Year Yield Touches 5.33%, Then Pulls Back
The 10-year Treasury yield hit 5.3338% during the session, its highest level since April 2002, before falling about 6 basis points to roughly 5.24% by the close. The retreat from multiyear highs helped stocks recover. The ISM manufacturing index was little changed at 54.5 for September, above the 50 line that separates expansion from contraction but below the 54.9 consensus.
Oil Jumps as China Halts Fuel Exports; Nike Falls After Hours
WTI crude closed at $92.91, up $2.49, or 2.75%, after China suspended October fuel exports from its refiners, tightening supply and pushing Brent back above $100. After the close, Nike reported adjusted earnings of $0.48 per share, above the $0.44 consensus, but revenue of $11.21 billion missed the $11.35 billion forecast. Revenue fell 4% year over year, Greater China sales dropped 26%, and North America grew 2%. Nike guided to a high-single-digit revenue decline in fiscal 2027, and its shares fell in after-hours trading.
September Payrolls Miss Badly at 29,000; Unemployment Rises to 4.2%
This morning's jobs report showed nonfarm payrolls rose just 29,000 in September, well below the 84,000 forecast and the prior 12-month average gain of 45,000. The unemployment rate rose to 4.2%, largely because more people entered the labor force. Average hourly earnings rose 0.1% to $37.81, up 3.0% from a year earlier. Stock futures climbed and Treasury yields retreated, and the odds that the Fed holds rates steady at its Oct. 27-28 meeting rose to 82.8% on CME FedWatch.
Concept of the Day
Labor Force Participation and the Unemployment Rate
The unemployment rate is the number of unemployed people divided by the labor force, which is everyone who is either working or actively looking for work. Because it is a ratio, it can rise for two very different reasons. Job losses push it up, but so does an influx of new job seekers, since people who enter the labor force and have not yet found work are counted as unemployed. The labor force participation rate measures the share of the working-age population that is in the labor force. When participation rises, the unemployment rate can tick up even while employment is growing. That is why economists look at the unemployment rate alongside payroll growth, participation, and measures such as the employment-population ratio rather than reading any single number in isolation. Payrolls come from a survey of employers and the unemployment rate from a separate survey of households, so the two can send different signals in a single month. A weak payroll number with a rising unemployment rate caused by new entrants is a softer signal on layoffs than the same unemployment rise driven by job losses.
Why it matters
September's report showed payrolls up just 29,000 against an 84,000 forecast, while the unemployment rate rose to 4.2%, largely because of an influx into the labor force. Markets treated the weak payroll number as the key signal: yields fell, futures rose, and the odds of a Fed hold on Oct. 27-28 climbed to 82.8%. Understanding why the rate rose helps separate a hiring slowdown from outright layoffs.
What to Watch
Mon, Oct 5
ISM Services PMI (September)
The services sector is the largest part of the economy, and the flash S&P Global services PMI hit a 59-month high of 58.7.
Wed, Oct 7
FOMC Minutes (September meeting)
The minutes detail the debate behind the Fed's unanimous 25 bp hike in September and hint at what comes next.
Fri, Oct 9
University of Michigan Consumer Sentiment (October)
It shows how consumers feel about the economy and prices after a month of rising borrowing costs.
Wed, Oct 14
Consumer Price Index (September)
The next major inflation reading ahead of the Fed's Oct. 27-28 meeting.