US close: Stocks slip as jobs data dampens rate-cut hopes

(Sharecast News) - US stocks finished slightly lower on Wednesday as the initial positive reaction to January's jobs report quickly faded as investors assessed the impact of stronger-than-expected payrolls on interest-rate policy.

"US futures had reacted positively to news that payrolls had been stronger than expected, but the potential for a delay to rate cuts seems to have weighed more heavily on investors as the full trading session got underway on Wall Street," said Chris Beauchamp, chief market analyst at IG.

The Dow slipped 0.1%, pulling back from Tuesday's record high of 50,188.14, while the Nasdaq fell 0.2% and the S&P 500 finished flat.

Investors were also digesting a barrage of corporate earnings from some big names, including Kraft Heinz, Shopify and T-Mobile.

However, Wednesday's primary focus was the Bureau of Labor Statistics' delayed January non-farm payrolls report, which revealed private sector employers added 130,000 jobs in January 2026, according to the Bureau of Labor Statistics, much higher than December's downwardly revised 48,000 increase and well above consensus estimates of 55,000.

Meanwhile, the unemployment rate edged down from 4.4% to 4.3%, beating forecasts for no change, while average hourly earnings rose 0.4% month-on-month, above the 0.3% consensus estimate, with annual wage growth holding steady at 3.7% year-on-year.

Kathleen Brooks, research director at XTB, said that the data shows the labour market is "gaining momentum", but will "put to bed hopes of a third rate cut for this year".

"The timing of the first Fed rate cut has been pushed back to July from June, and unless we see a large downside surprise in US CPI on Friday, it is hard to see a rate cut in the US in the first half of this year," Brooks said.

Elsewhere on the macro front, mortgage applications fell 0.3% in the week ended 6 February, according to the Mortgage Bankers Association, with applications to purchase a home dropped 2.4%, while applications to refinance a mortgage, which are more sensitive to week-to-week interest rate changes, increased by 1.1%.

Market movers

Kraft Heinz finished higher following an earlier fall after the American food giant revealed it was pausing its planned separation, announcing a $600m investment to return to growth. Chief executive Steve Cahillane, who joined Kraft Heinz in January, said in a statement that many of the company's challenges are "fixable and within our control".

Shopify fell 4% despite the Canadian online retail platform operator reporting strong fourth-quarter revenues and announcing a $2bn share buyback, as earnings disappointed. The company said it delivered a "standout 2025", after revenues grew 30% to US$11.56bn and gross profits swelled 24% to $5.56bn, though adjusted earnings came in at 48cents, short of the 50cents expected by analysts.

T-Mobile US missed estimates for phone subscriber growth in the fourth quarter, as aggressive holiday promotions intensified competition across the US wireless market, though shares still finished 6% higher.

Amazon.com was trading lower for the seventh straight day, having now dropped 16% since 2 February, with market reports linking the recent sell-off to its recent AI spending plans.