The United States Department of Labor reported that the number of jobs added by employers in the country was 204,000 after a revised 163,000 gain in September. The October employment data is higher than the 120,000 median estimate of economists polled by Bloomberg.

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Yesterday, the agency reported that jobless claims for declined from 345,000 to 336,000 for the week that ended November 2. Separately, the Department of Commerce reported that the U.S. gross domestic product (GDP) climbed from 2.5% to 2.8% in the third quarter.

The positive employment data showed that the U.S. economy is potentially strong enough to handle a potential reduction in the bond-buying program of the Federal Reserve. The stock markets rallied today following a decline on Thursday.

Last week, the Federal Reserve said they need to see move evidences of sustained improvement in the economy before tapering their $85 billion monthly bond purchases. Economists anticipate that policy makers might start tapering in March next year.

Eric Davidson, deputy chief investment officer of Wells Fargo Private Bank commented that the employment data is “good news.” He said, “This is what we’ve been looking for. The one thing that people have been waiting to see is an inflection point in terms of jobs and we’re starting to see that.”

On the other hand, Greg Woodard, strategist at Manning & Napier Inc commented, “The market is trying to deal with an improvement in the economy that may be offset by higher interest rates. You see a pullback in some areas of the market that are most sensitive to higher interest rates.” The benchmark for 10-year Treasury yield rose by 14.5 basis points to 2.750% on Friday, which is the highest level since mid-September.

Meanwhile, Dennis Lockhart, president of the Federal Bank of Atlanta commented that the economic data is less reliable because of the effect of the federal government shutdown. He said, “The context of policy making…is murkier than I would like. Because of the federal government shutdown, some of the data we follow are likely to be less reliable than usual through December.”

U.S. Markets

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Stocks in Focus

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NVIDIA Corporation (NASDAQ:NVDA) gained almost 7% to $15.56 per share after the company reported third quarter financial results that beat the consensus estimate of Wall Street analysts.  Nvidia recorded $0.26 earnings per share on $1.05 billion revenue.