Stocks hit record highs as strong jobs data, earnings fuel rally
Wall Street pushed to records as a 115,000-job April gain and powerful earnings beats overwhelmed oil shock fears and rate uncertainty.
Stocks climbed to record levels on Friday as investors treated a solid labor market and blowout corporate profits as stronger forces than a widening list of geopolitical and monetary risks. The S&P 500 and Nasdaq were on track for a sixth straight week of gains, their longest winning streak since October 2024, while the Dow Jones Industrial Average was headed for a second consecutive week of advances.
The April jobs report gave the rally fresh fuel. The U.S. Bureau of Labor Statistics said nonfarm payrolls rose by 115,000 and the unemployment rate held at 4.3%. Job growth came from health care, transportation and warehousing, and retail trade, even as federal government employment continued to decline. For traders, the message was clear: the labor market was cooling only gradually, leaving little pressure on the Federal Reserve to cut rates quickly.
That view helped keep rate expectations anchored in the 3.50% to 3.75% range through year-end, even as Jerome Powell and other Fed officials remained under pressure to reconcile sticky inflation risks with slower growth. The S&P 500’s forward 12-month price-to-earnings ratio stood at 21.0, above its five-year and 10-year averages, according to FactSet, showing how much optimism is already embedded in valuations. Still, the market kept buying. T. Rowe Price said the S&P 500 returned more than 10% in April, its best monthly performance since November 2020.
Earnings have been just as important as jobs in carrying the advance. Of the 440 S&P 500 companies that had reported first-quarter results, 83% topped analysts’ earnings estimates, according to LSEG. FactSet said 84% of reporting S&P 500 companies posted positive EPS surprises, with blended first-quarter 2026 earnings growth running at 27.7%. Strong results from artificial intelligence-related names, including Nvidia and Apple, also helped send the Philadelphia semiconductor index to a new high.
The rally endured even as oil markets flashed a more dangerous signal. Brent crude rose above $100 a barrel amid conflict in the Middle East and renewed concern over the Persian Gulf and the Strait of Hormuz, where the International Monetary Fund says about 25% to 30% of global oil and 20% of liquefied natural gas pass through. That corridor is central to energy prices, inflation, supply chains and global growth, but for now investors are betting that strong earnings and a resilient U.S. labor market can overpower the threat. The risk is that confidence remains as fragile as the headlines it is ignoring.
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