Stocks closed near a flatline on Friday as investors digested a stronger-than-expected jobs report ahead of the Federal Reserve's final monetary policy decision later this month. The Dow Jones Industrial closed only 0.1% higher, while the S&P 500 and Nasdaq Composite dipped 0.1% and 0.2%, respectively.
Here's how the market settled to close out the week:
S&P 500 Index (NYSE: SPY): -0.12% or -4.87 points to 4,071.70
Dow Jones Industrial Average (NYSE: DIA): +0.10% or +34.87 points to 34,429.88
Nasdaq Composite Index (NASDAQ: QQQ): -0.18% or -20.95 points to 11,461.50
All three major averages notched weekly gains. The Nasdaq jumped over 2%, while the S&P 500 added 1% and the Dow ticked 0.2% higher. Friday's close marked the first time all three benchmarks posted back-to-back weekly gains since October.
Driving market moves on Friday, the Labor Department's monthly jobs report for November showed U.S. private payrolls rose by 263,000 and the unemployment rate remained at 3.7%. That gain was larger than the 200,000 increase expected by economists polled by Bloomberg. November's gains were a slight decrease from October's upwardly revised print of 284,000.
Friday's moves followed a a mid-week rally as market sentiment was boosted by comments from Fed Chair Jerome Powell that signaled the central bank may soon ease the pace of its hawkish rate hiking campaign.
However, the stronger-than-expected jobs report may have diminished some of that optimism, as policymakers may see November's jobs report as a sign they need to continue increasing interest rates to further cool down the labor market.
Earlier this week, Powell said the job gains are "far in excess of the pace needed to accommodate population growth over time" and that wage growth is contributing to inflation.
"To be clear, strong wage growth is a good thing. But for wage growth to be sustainable, it needs to be consistent with 2 percent inflation," Powell said during a speech on Wednesday. In November, wages grew by 5.1% annually and 0.6% month-to-month, both topping economist expectations.
November's jobs report is the final monthly employment report before the central bank's two-day meeting December 13-14, in which policymakers are expected to deliver a smaller 50 basis point interest rate hike compared to the 75 basis point increase issued in recent months.