US stocks slipped as investors ramped up bets of a Federal Reserve rate hike following a surprisingly strong August jobs report.

The Dow Jones Industrial Average (^DJI) fell more than 0.5%, and the S&P 500 (^GSPC) declined by 0.4% after the two benchmark indexes posted their best day in nearly a month. The tech-heavy Nasdaq Composite (^IXIC) dipped 0.3%.

All eyes were on the August payrolls report, which showed 162,000 jobs added in the previous month, blowing past economists’ expectations of 55,000 jobs added. That offered a strong countersignal to the The question on Wall Street was whether August’s strong jobs number would be enough to tilt the Fed toward hiking interest rates. Following the hot jobs report, traders increased their bets on a Fed rate hike in September to roughly 58%, according to CME Group.

In individual stock moves, Lululemon stock tanked 17% after the athleisure apparel company cut its revenue and profit guidance, and second quarter revenue declined. There are no other notable earnings reports scheduled for Friday.

LIVE COVERAGE IS OVER 14 updates

  • Stocks slip as investors price in Fed rate hike following strong jobs report

    A strong jobs report sent bond yields higher, signaling that the Federal Reserve may need to raise interest rates amid a resilient economy and persistent inflation.

    The Dow Jones Industrial Average (^DJI) dropped 0.5%, while the S&P 500 (^GSPC) declined by 0.4%. The tech-heavy Nasdaq Composite (^IXIC) dipped 0.3% as markets priced in expectations that the Federal Reserve will need to hike rates at its next policy meeting in September.

    Stocks moved lower after the monthly labor market report showed 162,000 jobs were added last month, blowing past economists’ estimates.

    Gold and bitcoin both moved lower, while tech stocks edged slightly higher.

    Next week will be a shortened trading week due to the Labor Day holiday. The stock market will reopen on Tuesday.

  • Stock market today: Dow, S&P 500, Nasdaq slip as blowout jobs report raises odds of a Fed rate hike

    Wall Street moves forward rate cut expecations

    Economists are moving up their expectations for rate hikes after Friday’s blowout jobs report.

    “We now expect two 25-basis-point rate hikes, the first in September, followed by a second hike in December after the midterm elections,” UBS economist Andrew Dubinsky wrote on Friday, adding that if inflation readings through October come down, the second hike may be postponed.

    Macquarie is another firm that moved forward with its expectations, citing Friday’s strong jobs report.

    “The strong report, together with hawkish remarks on inflation last week from Chair Warsh, has led to a shift in market expectations for Fed hikes,” economist David Doyle wrote on Friday.

    “While the timing remains uncertain, we move our baseline case for the first 25 bps hike to September (prev. Dec). We continue to anticipate a second 25 bps hike in 1Q27,” he added.

  • Jared Blikre

    Bitcoin’s $80,000 breakout just failed after a blowout jobs report

    Bitcoin nearly crossed the Rubicon. Then Friday’s jobs report sent the bulls backward.

    Bitcoin (BTC-USD) surged over 5% Thursday, then climbed as high as $82,000 and change Friday morning — less than $1,000 from the resistance that has capped it since February — before reversing below the big $80,000 level.

    Friday brought the counterpunch.

    Bitcoin came within roughly $700 of the $83,000 ceiling Friday before reversing below $80,000. The black dotted line marks the August 19 Treasury announcement that ignited the debasement trade. · Yahoo Finance AlphaSpace

    Employers added 162,000 jobs in August, nearly triple expectations, while June and July payrolls were revised higher by a combined 55,000. The unemployment rate held at 4.1%.

    The report strengthened the labor side of the case for a September rate hike by the Federal Reserve, even as cooler wage growth left inflation as the next big hurdle. Bitcoin, gold, and many of Thursday’s high-beta winners turned lower as shorter-term yields and the dollar rose.

    Read more.

  • Trump threatens to stop trading with countries that have a trade deficit unless the Fed cuts rates

    Yahoo Finance’s Ben Werschkul reports:

    Touting Friday’s blowout jobs number, President Trump used the opportunity to weigh in on a new spike in the US trade deficit, threatening embargoes on unfavored countries.

    Trump posted on Truth Social, in what appeared to be a directive to the Federal Reserve, to “LOWER THE RATE OR I’LL STOP TRADING WITH COUNTRIES WITH WHICH WE HAVE A DEFICIT.”

    Trump, who has long voiced a desire for lower interest rates, asserted that an embargo could be “BETTER THAN TARIFFS” and said “the Fed Board, with its great new leader, must get smart.”

    Pressure on the central bank from the president isn’t new, but the threat of a trade embargo is. Embargoes would be a new level of disruption for the global economy, and the president likely has the legal authority to follow through.

    Read more.

  • Jake Conley

    Tesla shares sink as NHTSA begins investigation into Cybercab

    Tesla (TSLA) shares moved sharply lower Friday morning after reports that the company is facing an investigation by the US traffic safety regulator into whether its new Cybercab model complies with regulatory requirements.

    Shares pulled back by roughly 6% on Friday’s announcement of an investigation by the National Highway Traffic Safety Administration.

    The investigation formally began on Thursday, per the NHTSA announcement — the same day Tesla held its official launch event for the Cybercab in Austin, where the company said customers will be able to book rides beginning Friday evening.

    Tesla said it certified the initial small deployment of vehicles — which lack a steering wheel and breaks, among other typical automobile features — with the US Federal Motor Vehicle Safety Standards (FMVSS).

    The NHTSA has said its investigation “will examine the process and technical data on which Tesla relied when certifying the Cybercab and related issues,” alongside “the extent to which Tesla’s certification depended on determinations that certain FMVSS are inapplicable to the Cybercab. “

  • US retail diesel hits tecord as Hormuz, Russia crises stretch on

    Diesel prices hit a record high on Friday as the wars in the Middle East and Russia disrupt energy flows.

    The move higher is not without consequences for the global economy, as it has a wide range of uses, from home heating and transportation to heavy construction and farming equipment.

    Bloomberg reports:

    The widely used fuel climbed to a nationwide average of $5.85 a gallon at the pump on Thursday, according to the American Automobile Association. The advance pushed the price above the former peak set in June 2022, as a crunch on global supplies continues to unfold just ahead of peak-demand season.

    In the Middle East, the US-Iran war has disrupted flows through the Strait of Hormuz , with TotalEnergies SE’s head Patrick Pouyanne saying in August there wasn’t a “single tanker of products” moving out of the waterway. At the same time, Russia extended a ban on diesel exports through September after a wave of Ukrainian drone strikes on the country’s refineries.

    Read more.

  • Stocks edge lower as hot jobs data fuels rate-hike bets

    Stocks drifted lower in early trading as markets absorbed a surprisingly strong jobs report that showed the US added 162,000 jobs, far exceeding expectations.

    The Dow (^DJI) and S&P 500 (^GSPC) fell by 0.3% and 0.2%, respectively. The Nasdaq (^IXIC) traded near the flat line.

    Here’s a look at the sector action in early trading:

    Bond yields jumped in reaction to the jobs report. The 10-year yield (^TNX) increased by 1 basis point to 4.77%, while the 30-year yield (^TYX) held at 5.24%.

    The probability of a Federal Reserve rate hike in September, as tracked by CME Group’s FedWatch tool, jumped to 60% in the aftermath of the August jobs report release. The day before, traders had pared back odds of a rate hike to a 50-50 split.

  • US adds 162,000 jobs in August, blowing past estimates

    The August jobs report numbers are in, and the data showed blowout jobs growth last month.

    The top-line number was 162,000, compared to expectations of 55,000 jobs gained.

    The unemployment rate remained steady at 4.1%.

    Average hourly earnings grew 0.3%, in line with 0.3% wage growth expected.

    Friday’s report is a new data point for the Federal Reserve ahead of its Sept. 16-17 meeting, Yahoo Finance’s Claire Boston noted. The central bank has been weighing whether to hike rates to combat persistently hot inflation, but doing so risks further slowing a relatively sluggish job market.

    Read more.

  • Is AI displacing workers? The data says no.

    Yahoo Finance’s Jake Conley reports:

    Despite widespread worries that AI would quickly destabilize and displace the labor force, data suggests that this may not be the case, as employers opt for adaptation rather than layoffs.

    Planned job cuts in the US labor market fell in the first eight months of 2026 to the lowest level seen in four years, according to data released Thursday by the outplacement firm Challenger, Gray & Christmas, while hiring plans through the same period reached their highest level since 2023.

    Put simply, “There is still no evidence that AI is replacing workers,” Apollo Global chief economist Torsten Sløk said Thursday, a sign that AI’s impact on the economy may be shaping up differently than expected. (Disclosure: Yahoo is a portfolio company of funds managed by affiliates of Apollo Global Management.)

    Job cut announcements in August rose from July, but the total so far this year is down 41% compared to 2025. And even those layoffs that were announced in August weren’t primarily driven by AI; employers cited other reasons beyond AI as the primary driver of job cuts for the first time in six months.

    Read more.

  • Claire Boston

    What to expect from the August jobs report

    US employers are expected to have added 55,000 jobs in August, bouncing back from July’s surprise job losses, when the Bureau of Labor Statistics releases its latest reading on the labor market on Friday.

    Economists surveyed by Bloomberg expect the unemployment rate to hold steady at 4.1%. Another month of modest job creation and an unemployment rate that’s relatively low by historical standards would be further evidence that the US remains in a “low hire, low fire” environment, marked by relatively sluggish hiring, but also limited layoffs.

    Friday’s report is a new data point for the Federal Reserve ahead of its Sept. 16-17 meeting. The central bank has been weighing whether to hike rates to combat persistently hot inflation, but doing so risks further slowing a relatively sluggish job market.

    Read more.

  • Stock market today: Dow, S&P 500, Nasdaq slip as blowout jobs report raises odds of a Fed rate hike

    Lululemon stock sinks after cutting forecast as revenue declines

    Lululemon (LULU) stock dropped as much as 20% in extended trading on Friday. The athleisure wear company cut its revenue and profit forecast. Lululemon said its second quarter fiscal 2026 revenue decreased 4% to $2.4 billion, with comparable sales decreasing 9%.

    “While we continue to navigate some challenging dynamics, we are taking a prudent approach with our revised full-year outlook,” said Meghan Frank, Interim co-CEO and CFO.

    For 2026, the company now expects net revenue to be in the range of $10.35 billion to $10.5 billion, representing a decline of 5% to 7%. Adjusted earnings per share are now expected to be in the range of $9.48 to $9.73 for the year.

    The disappointing results come as Nike veteran Heidi O’Neill prepares to take over as CEO next week.

    Read more.

  • Jared Blikre

    Fed Chairman Kevin Warsh just changed the rules for trading the jobs report

    Wall Street will obsess over Friday’s payroll numbers. Federal Reserve Chairman Kevin Warsh may barely flinch.

    That is one of the clearest lessons from Warsh’s first Jackson Hole speech as chair one week ago. He spent much of it arguing against the Fed guiding investors toward its next rate decision, then laid out a detailed framework for how he reads inflation, jobs, demand, corporate activity, and markets.

    His current diagnosis leans hawkish. Jobs look solid, inflation pressures remain too high, and broad financial conditions do not look restrictive.

    Every Fed chair watches data and markets. Warsh’s distinction is that he wants to say less about the future rate path and make markets do more of the interpreting — part of his push to have markets guide the Fed rather than simply echo it.

    Read more.

  • Good morning. Here’s what’s happening today.

    Economic data: Change in nonfarm payrolls, August (+58,000 expected, -23,000 previously); Change in private payrolls, August (+50,000 expected, +30,000 previously); Change in manufacturing payrolls, August (+5,000 expected, +5,000 previously); Unemployment rate, August (4.1% expected, 4.1% previously); Labor force participation rate, August (61.4% expected, 61.4% previously); Average hourly earnings, month-on-month, August (+0.3% expected, +0.1% previously); Average hourly earnings, year-on-year, August (+3% expected, +3.2% previously)

    Earnings calendar: No notable earnings.

    Catch up on some top stories you might have missed overnight:

    Volkswagen plans 50,000 more job cuts amid biggest overhaul in its history

    Fed’s Waller channels Lennon with a plea to ‘give disinflation a chance’

    Lululemon sinks after cutting forecast as revenue declines

    Asian shares climb ahead of US jobs data, Fed’s Waller soothes bonds

    Oura files to go public

  • US dollar slumps to start September as yen surges on rate bets

    Bloomberg reports:

    The dollar slumped to start September as traders cut bets on a Federal Reserve rate hike this month and a surging yen rippled across global currency markets.

    The Bloomberg Dollar Spot Index was on track to wrap up the week 0.7% lower after touching its lowest level since May on Thursday. Investors now see roughly even odds of a rate hike at the central bank’s Sept. 16 decision after Fed Governor Christopher Waller pointed to progress on inflation, adding to pressure on the greenback amid lingering concerns over the US fiscal outlook.

    In Japan, the yen is on track for its best week since July, gaining 2.7% against the dollar. The move has been fueled by expectations that the Bank of Japan may raise its benchmark rate by a quarter point this month, while leaving the door open to faster hikes thereafter.

    “The dollar took a step back this week as Fed speak leaned dovish and a yen rally spilled over to the broader USD complex,” said Noah Buffam, strategist at CIBC Capital Markets.

    Read more.