S&P 500 Notches Record High Ahead of August Jobs Report

05:12 PM EDT, 09/04/2025 (MT Newswires) -- The S&P 500 closed at a record high on Thursday as fresh employment data lifted expectations that the Federal Reserve will cut interest rates later this month, while traders awaited the August jobs report due out on Friday.

The S&P 500 and the Dow Jones Industrial Average climbed 0.8% each to 6,502.1 and 45,621.3, respectively. The tech-heavy Nasdaq Composite rose 1% to 21,707.7. Barring utilities, all sectors ended higher, led by consumer discretionary.

In economic news, employment in the US private sector rose by 54,000 in August, Automatic Data Processing (ADP) reported Thursday. That was less than the 68,000 increase expected in a survey compiled by Bloomberg.

Challenger Gray & Christmas reported that US job cuts totaled 85,979 last month, up 13% year on year and surging 39% sequentially.

Data from the Department of Labor showed that weekly applications for unemployment insurance in the US rose more than expected, while continuing claims fell.

On Wednesday, official data showed that US job openings declined in July for the second month in a row.

"All signs are pointing to softer labor market conditions, with Friday's jobs report expected to show an uptick in the jobless rate," Priscilla Thiagamoorthy, senior economist at BMO, said in a report published Thursday.

The Bureau of Labor Statistics is expected to report Friday that the US economy added 75,000 nonfarm jobs last month, compared with a 73,000 gain reported for July, according to a Bloomberg-compiled survey. The unemployment rate is projected to tick up to 4.3% from 4.2%.

"The recent slew of disappointing employment data paints an increasingly precarious picture of the US labor market," supporting potential monetary policy easing by the Fed later this month, Stifel said in a Thursday client note.

The odds of a 25-basis-points rate cut on Sept. 17 rose to 97.3% on Thursday from 96.6% on Wednesday, according to the CME FedWatch tool.

The Fed's current monetary policy stance is "appropriate" as inflation continues to be above policymakers' 2% goal, while the labor market has been generally consistent with maximum employment, New York Fed President John Williams said.

"If progress on our dual mandate goals continues as in my baseline forecast, I anticipate it will become appropriate to move interest rates toward a more neutral stance over time," Williams said.

US Treasury yields were lower, with the 10-year rate falling 5.7 basis points to 4.16% and the two-year rate losing 2.7 basis points to 3.60%.

The US services sector saw continued growth in August, though there were tariff-related inflation concerns among firms, two separate surveys by the Institute for Supply Management and S&P Global (SPGI) showed Thursday.

On Wednesday, US President Donald Trump reportedly filed an appeal with the Supreme Court to uphold his reciprocal tariffs, after the US Court of Appeals for the Federal Circuit recently ruled that most of them were illegal.

The US trade deficit widened to the largest in four months in July as imports soared, while the goods trade gap with China and Canada grew, government data showed Thursday. The deficit surged as firms rushed to import goods ahead of new tariffs, Stifel said.

West Texas Intermediate crude oil was down 1.1% at $63.29 a barrel in Thursday late-afternoon trade.

In company news, Goldman Sachs (GS) plans to buy up to $1 billion worth of T. Rowe Price (TROW) common shares, as the two companies joined forces to offer retirement and wealth management products. T. Rowe shares were up 5.8%, the top gainer on the S&P 500, while Goldman rose 2.5%.

Ciena (CIEN) logged better-than-expected fiscal third-quarter results and issued an upbeat revenue outlook for the ongoing three-month period. The networking systems and software company's shares jumped 23%.

Salesforce (CRM) was the worst performer on the Dow and the second-worst on the S&P 500, down 4.9%.

The customer relationship management platform late Wednesday didn't raise its fiscal 2026 sales outlook for the second quarter in a row, despite strong growth in the data cloud and artificial intelligence segments, UBS Securities said Thursday.

The company maintained its full-year constant-currency revenue growth outlook at 8%. Salesforce (CRM) posted stronger-than-expected second-quarter results.

Gold was down 0.8% at $3,606.30 per troy ounce, while silver dropped 1.7% to $41.35 per ounce.

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