A surprisingly strong December Jobs report dashed hopes that the Fed will cut rates of interest any time soon, as signs of a strong economy feed right into a posture of “higher for longer” on the US central bank.

The Dow Jones Industrial Average (^DJI) sank about 1.6%, or over 600 points, while the S&P 500 (^GSPC) fell 1.6%. The tech-heavy Nasdaq Composite (^IXIC) tumbled 1.8%. The three major gauges erased all year-to-date gains with Friday’s pullback.

Odds of a rate cut in March fell to around 25% following the info release, down from about 44% a day ago, in line with the CME Fedwatch tool.

Fed officials have already expressed concern with sticky inflation, giving them more reasons to approach rate of interest policy with caution. Alongside pricing pressure expectations from the trade and immigration policies of the incoming Trump administration, the most recent data likely spells an extended period with no rate cuts.

Homebuilder stocks sank because the stronger-than-expected jobs report raised investor concerns that rates of interest will remain higher for longer this 12 months.

The SPDR S&P Homebuilders ETF (XHB) fell nearly 2% Friday. DR Horton (DHI), the largest US homebuilder, together with Lennar (LEN) and PulteGroup (PHM) dropped roughly 1%, 2%, and 1%, respectively.

High mortgage rates have kept many potential homebuyers and sellers on the sidelines. The speed on the 30-year mortgages has been inching closer to 7% for the fourth consecutive week, according Freddie Mac.

Following the most recent jobs report, markets at the moment are anticipating no Fed easing before July, per the CME FedWatch Tool. While the Fed doesn’t set mortgage rates, its decisions influence them.

Builders have also been under pressure from rising material and labor costs, with the most recent employment picture showing a slowdown in construction job growth. Data from the Labor Department showed that construction firms added 8,000 jobs in December, down from 10,000 jobs added in November.

Oil jumped to as much as $80 per barrel, a three-month high on Friday as traders digested latest sweeping energy sanctions by the US against oil producer Russia.

West Texas Intermediate crude (CL=F) rose as much as 4% to rise above $77 per barrel, while Brent crude futures (BZ=F), the international benchmark price briefly hovered just above $80 per barrel.

Greater than 180 vessels, insurers, and top Russian energy executives, in addition to two major oil corporations, were all named within the sanctions announced on Friday morning.

“The US is taking sweeping motion against Russia’s key income for funding its brutal and illegal war against Ukraine,” Treasury Secretary Janet Yellen said in an announcement.

Oil prices were already on an upward trend coming into 2025 with traders on edge over President-elect Donald Trump’s policy toward producer Iran. Tehran currently produces greater than 3 million barrels of crude per day.

“News continues to filter in a couple of Trump [administration’s] hard stance on Iran that will come in a short time,” Dennis Kissler, senior vp at BOK Financial, wrote in a note to clients on Friday.

“Add within the Freezing temps across a lot of the US, together with shrinking storage numbers, and crude has now turn out to be a latest ‘fund favorite,'” he added.

A hot jobs report makes it much more likely the Federal Reserve won’t cut rates at its first meeting of the 12 months in January — or for the foreseeable future, as more evidence surfaces of a powerful economy, reports Yahoo Finance’s Jennifer Schonberger.

“I believe they’re done here,” Blake Gwinn, the top of US rates strategy at RBC Capital Markets, told Yahoo Finance on Friday.

“That January cut was already nearly dead before this print,” Gwinn added. “Now we’re that March print” — ahead of the Fed’s second meeting of 2025.

Fed officials were already concerned about signs of persistent inflation, citing that as a reason to maneuver cautiously in 2025, together with expectations that the trade and immigration policies of the brand new Trump administration might provide more upward pressure.

Read more concerning the Fed’s next policy move here.

Venu Sports, the planned sports streaming service from Disney’s ESPN (DIS), Warner Bros. Discovery (WBD), and Fox (FOXA), will not make a debut.

“After careful consideration, we have now collectively agreed to discontinue the Venu Sports three way partnership and never launch the streaming service,” the three corporations said in a joint statement on Friday.

“In an ever-changing marketplace, we determined that it was best to satisfy the evolving demands of sports fans by specializing in existing products and distribution channels.”

The move caps off a wild week for Venu after FuboTV (FUBO) settled all litigation related to the debut earlier this week. The news and sports streamer had filed an antitrust lawsuit against the platform’s launch last 12 months.

The settlement coincided with an announcement that Fubo, an online TV bundler, would join forces with Disney’s Hulu + Live TV business. Individually, Disney will roll out an ESPN flagship streaming service service this fall.

Fubo stock popped around 10% in early trading on Friday after surging 250% Monday on the heels of the Disney deal announcement. Fox and WBD shares fell on the news. Disney’s stock traded flat.

The “higher for longer” narrative just got a dose of strength on Friday.

The nonfarm payrolls report showed a really healthy labor market: The US economy added over 250,000 jobs in December, while the unemployment rate fell to 4.1%. On its face, that is excellent news. However the fresh data also fed right into a dilemma for Wall Street: A powerful reading could prompt the Fed to nudge rates higher.

US stocks pulled back on the open as investors digested the ultimate 2024 jobs report, which blew past expectations on hiring, raising more uncertainty when the subsequent rate cut will come.

The Dow Jones Industrial Average (^DJI) slipped roughly 0.5%, while the S&P 500 (^GSPC) shed 0.6%. The tech-heavy Nasdaq Composite (^IXIC) fell 0.9%, leading declines as the most important gauges arrange for weekly losses.

The US economy added 256,000 jobs in December, probably the most in nine months and almost 100,000 greater than Wall Street had expected because the labor market finished 2024 on a surprisingly high note.

In December, the unemployment rate also fell to 4.1% from 4.2%. Revisions showed the unemployment rate never reached the high of 4.3% reported initially in November.

Friday’s report saw Treasury yields rise as investors proceed to ward off expectations for Fed rate cuts in 2025, with no cuts expected now before June. Stock futures turned lower following the report.