US Economy Adds 165,000 Jobs as Tech Stocks Bounce Back

The US economy added 165,000 jobs in October, a figure that more than doubled analyst expectations and provided a strong counterpoint to recent market volatility. The data, released Friday morning, showed the unemployment rate easing to 4.1% from 4.2% in September. This employment strength arrived as investors sought reassurance after a sharp decline in technology stocks earlier in the week.

The market rout began Thursday when AI and broader tech shares fell sharply. The Nasdaq Composite dropped 5.5% that day. The sell-off was driven by investor concerns following the Democratic victory in the recent midterm elections. Democrats took control of both houses of Congress and won key state contests central to the race for AI data centers. Many candidates had campaigned on new rules for AI and data infrastructure, fueling fears of increased regulatory burdens.

Friday’s trading session marked a partial reversal of those losses. The Nasdaq Composite opened higher, gaining 1.23% in early trading. Nvidia, which lost hundreds of billions of dollars in market value on Thursday, saw its shares rise by more than 6%. Tesla and SpaceX also recovered ground, with their shares climbing nearly 3% and more than 7%, respectively.

President Donald Trump addressed the market sentiment on Friday. He reiterated his support for what he calls super intelligence. He stated that only foolish leadership would reject the riches such technology brings. His comments aimed to reassure investors that federal backing for the sector remains intact despite the political shift in Congress.

The labor report details showed that professional and business services led job growth, adding 70,000 positions. The healthcare sector followed with 42,000 new jobs. Manufacturing and transportation and warehousing also contributed to the overall increase. The Bureau of Labor Statistics noted that the unemployment rate has stayed within a narrow range of 4.1% to 4.3% since March.

Neil Birrell, chief investment officer at Premier Miton, commented on the interplay between the data and the stock market. He observed that the US economy is currently running hard. He suggested that the risks markets are worrying about may not be as threatening to the real economy as initially feared.

Traders are now digesting the strong labor figures alongside the midterm election results. The focus remains on whether the initial bounce in AI stocks can hold against lingering concerns about future regulations and political dynamics.