US equities extended their bullish early-January run on Friday to notch new closing records, as bets on economic growth coalesced with expectations that the Federal Reserve remains on track to cut rates further this year.
The S&P 500 Index on Friday climbed 0.7 per cent in New York to a fresh high, after a US employment report did little to alter expectations that the Fed will leave interest rates on hold for now, though a number of cuts were still priced in for later in 2026.
The technology-heavy Nasdaq 100 Index rallied 1 per cent.
Investors also delved into other areas of the market, including small-caps and so-called value stocks, traditionally a sign of confidence in the economy.
An equal-weighted version of the S&P 500 hit a record and posted its best week since November, while the small-cap Russell 2000 Index and Dow Jones Industrial Average also hit milestones. The Russell logged its best week relative to the S&P 500 since 2024.
The S&P 500 is approaching the 7,000 level and the Dow is close to the 50,000 mark after a strong start to 2026 trading.
“There might be some psychological significance around the milestone of another 1,000 points, but the makeup of the advance is more important,” said Kevin Gordon, head of macro research and strategy at Charles Schwab & Co. “This recent push has been driven by the majority of sectors while tech has mostly sat out.”
US employers added fewer jobs than expected in December, suggesting the labor market continued to soften at year-end, data released earlier in the day showed. The report supported expectations that the Federal Reserve will hold rates steady at their January meeting but left the door open for cuts later in the year.
“The labor data today signals more balance than weakness in the labor market,” said Cayla Seder, macro multi-asset strategist at State Street. “This number is strong enough that it signals the economy is okay, but isn’t so strong that the market needs to drastically change their monetary policy expectations, which is a tailwind for equities.”
Nonfarm payrolls increased by 50,000 last month after downward revisions to the prior two months, according to the Bureau of Labor Statistics. The unemployment rate edged down to 4.4%, settling back after the record-long government shutdown.
Waiting on Tariffs
Meanwhile, the Supreme Court did not deliver a highly awaited decision on the legality of President Donald Trump’s tariffs. A ruling remains one of the next big tests for US stocks and bonds, and the court could issue more opinions in the next two weeks.
Tariff-exposed stocks quickly fell after no decision was issued: Deere & Co. dropped 2.54%, while United Parcel Service Inc. and FedEx Corp. sharply pared gains. In the consumer sector, Mattel Inc. slid 3.07% and Nike Inc. more than 1%.
Striking down the tariffs would likely give a boost to stocks by promising to improve profit margins and remove a burden on consumers. At the same time, Treasuries may come under pressure as that potential stimulus complicates the outlook for the Fed’s rate-cut path and threatens to worsen the government’s budget deficit.
Elsewhere, shares of mortgage stocks soared on Friday after the president said on his social media platform that he was directing the purchase of $200 billion in mortgage bonds. Companies including LoanDepot Inc., Rocket Cos Inc., and Opendoor Technologies Inc. were among the gainers.
On the corporate side, Meta Platforms Inc. agreed to a series of electricity deals to power data centers that will make it the biggest buyer of nuclear power among its hyperscaler peers. US-listed shares of Taiwan Semiconductor Manufacturing Co are up after the company reported strong December sales. Qualcomm Inc. shares are down after Mizuho Securities downgraded the chipmaker to neutral from outperform.
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Published on January 10, 2026
