The Closing Bell

Wall Street shrugged off the gloomiest consumer sentiment reading in recent memory to close out the week with a tech-led rally, leaving traders to square a stock market at session highs against a consumer that says it has never felt worse about the economy.

The jobs report landed soft but not soft enough to spook rates, and sentiment cratered.

Nonfarm payrolls came in at 165K with unemployment at 4.1% and wages up 3.1% year over year, a print steady enough to keep the soft-landing narrative intact. The real shock was the University of Michigan's preliminary sentiment read, which collapsed to 51, with one-year inflation expectations spiking to 4.3% and five-year expectations at 3.4%. That combination, growth holding up while households brace for sticky inflation, is the definition of stagflation anxiety, yet equities didn't blink. The dollar (UUP) firmed 0.7%, long bonds (TLT) sat flat, gold (GLD) slipped 0.8%, and oil (USO) ticked up 0.7%, a mix that reads more "cautious repricing" than "risk-off."

Tech led, and breadth was broad.

The Nasdaq-100 proxy (QQQ) jumped 1.7% to lead all major benchmarks, with small caps (IWM) up 1.2% and the S&P (SPY) adding 0.6%. Nuclear and infrastructure names stayed in the mix, with Oklo (OKLO) announcing a manufacturing agreement with U.S. Forged Rings on the same day it reported, and space names got a lift after Firefly Aerospace signed a rocket engine deal with AST SpaceMobile valued above $1.3 billion.

Earnings reactions were brutal in spots.

iRhythm Holdings (IRTC) was the day's standout disaster, plunging 32.2% as BTIG, Needham and Truist all slashed targets following results, a move that wipes out half the stock's year. Oscar Health (OSCR) dropped 8.3% even as Piper Sandler and UBS kept constructive ratings, trimming targets to $45 and $38. Advance Auto Parts (AAP) fell 4.7% despite RBC and UBS raising targets to $51 and $50, and CarGurus (CARG) slid 4.3% as both UBS and RBC cut their numbers. Kontoor Brands (KTB) lost 2.3% on what UBS called temporary U.S. wholesale headwinds, and Dropbox (DBX) eased 2.2%. On the upside, Ashland (ASH) gained 1.8% even as Bloomberg reported Evonik is cooling on a bid, and Cummins (CMI) added 1.0% as Wells Fargo, Citi and Barclays all revisited targets. Ralph Lauren, Shift4 Payments, 10x Genomics, Redwire and Installed Building Products all saw target resets following Q3 prints.

After the bell & tomorrow.

Charter Communications, Moderna, Humana and Brookfield Asset Management were on today's earnings calendar alongside a long tail of regional and small-cap names. Watch for follow-through on the Michigan inflation expectations shock and whether next week's data flow forces a rethink of the Fed path that stocks have so far ignored.

Bottom line: traders bought growth and sold sentiment today, a split that can't hold indefinitely if inflation expectations keep climbing.