U.S. stocks closed lower on Tuesday, with the S&P 500 retreating as mixed labor market data showed unemployment rising to its highest level in more than four years, reigniting concerns about the broader economic outlook.
S&P 500 slips as unemployment rate rises
By mid-afternoon trading, the Dow Jones Industrial Average was down 413 points, or about 0.7%. The S&P 500 fell 0.6%, while the Nasdaq Composite edged 0.3% lower.
Fresh data from the Bureau of Labor Statistics showed that nonfarm payrolls increased by 64,000 in November, beating expectations of 50,000 jobs and reversing part of October’s revised loss of 105,000 positions.
However, the unemployment rate climbed to 4.6%, slightly above forecasts of 4.5% and the highest level in over four years. The increase has intensified worries that the U.S. labor market may be losing momentum.
Fed policy outlook remains data dependent
Analysts said the latest jobs report does not yet signal a major shift in the labor market outlook. Some noted that if the Federal Open Market Committee were meeting today, policymakers would likely prefer to keep interest rates unchanged.
Markets are now turning their attention to the upcoming U.S. consumer price index data for November, which could provide further clues on inflation trends. Labor conditions and inflation remain the Federal Reserve’s two primary factors when considering future rate cuts.
Retail sales and Fed leadership in focus
In separate data, U.S. retail sales unexpectedly stalled in October after a downwardly revised 0.1% increase in September, adding to concerns about consumer demand.
Investors are also watching developments around the next Federal Reserve chair. Reports suggest President Donald Trump has narrowed his shortlist to former Fed Governor Kevin Warsh and National Economic Council Director Kevin Hassett as potential successors to Jerome Powell.
Corporate earnings and market developments
With the earnings season nearing its end, homebuilder Lennar is due to report results after the U.S. market close. The company previously posted a sharp decline in third-quarter profit, reflecting ongoing affordability pressures in the housing market.
Shares of Pfizer fell after the drugmaker issued 2026 earnings guidance below analyst expectations. Elsewhere, Nasdaq is seeking regulatory approval to extend trading hours to nearly 23 hours per weekday, according to reports.
In the digital asset space, Visa announced that U.S. banks and fintech firms will be able to settle transactions in Circle’s USDC stablecoin, beginning with the Solana blockchain.
