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In the wake of Friday's jobs report showing the labor market deteriorating unexpectedly sharply, the question on the minds of investors and economists is no longer whether the Federal Reserve will cut interest rates at its next meeting in September, but how steeply it will cut them.The jump in the unemployment rate in July to its highest since 2021 could give the Fed motivation to cut its benchmark fed funds rate faster than previously expected. Several forecasters changed their predictions for the central bank's next moves, calling for three quarter-point rate cuts by the end of the year instead of two.

Traders are projecting an even more aggressive path. Financial markets late Friday were pricing in 1.25 percentage points of rate cuts by the end of 2024, up from three-quarters of a point the day before, according to the CME Group's FedWatch tool, which forecasts interest rate movements based on fed funds futures trading data. The likelihood being priced in of a half-point cut at the September Fed meeting was around 72%, up from 22% on Thursday.

The Fed is now under pressure to respond to the weakening labor market because of its twofold mission to to keep inflation low and employment high. Recent reports have shown inflation falling towards the Fed's goal of a 2% annual rate from its post-pandemic surge, and with the threat of rising unemployment growing larger, the central bank may shift its focus towards preventing mass layoffs."This clearly gives the Fed the green light to start cutting rates in September, and the market's attention will now shift focus toward how many and how deep the coming cuts will be," Scott Anderson, chief U.S. economist at BMO Capital Markets, wrote in a commentary.

Earlier this week, the Fed's policy committee opted to leave its influential fed funds rate at a range of 5.25% to 5.50%, where it has been for a year. Fed Chair Jerome Powell said that the central bank could cut the rate as soon as the Federal Open Market Committee's next meeting in September.

The shift to possible rate cuts marks a turning point for the Fed, which raised interest rates starting in March 2022 to combat inflation. By lifting the fed funds rate to their current level, the highest since 2001, the Fed put upward pressure on interest rates for mortgages, credit cards, and other debt, discouraging borrowing and spending in an effort to cool off an overheated economy and allow supply and demand to rebalance.Further economic data is due to be published before the Fed has to make a decision on interest rate moves in September, including several reports on inflation and another major report on the job market, which could shift the outlook.

There's also a chance that the jump in unemployment may prove to be a temporary blip rather than the start of a trend. As Matt Coylar, an economist at Moody's Analytics noted, many of the unemployed in July simply couldn't work because of bad weather caused by Hurricane Beryl.

"I think this is just too narrow of data just yet to really inspire panic," Coylar said in an interview with Investopedia. "And I would say that financial markets are potentially overreacting."

However, even if the job slowdown isn't as bad as it seems at first glance, the psychological impact could make it a self-fulfilling prophecy, especially if future data reinforces the impression, Coylar said."People who are expecting an imminent downturn, they may feel vindicated, and maybe it's time to pull back spending hunker down, then it becomes self perpetuating," Coylar said.

At least for now, fed-watchers are betting that the days of high interest rates are numbered.

Just as the rate hikes pushed borrowing costs to their highest in decades, a lower fed funds rate is meant to ease some of that financial pressure, and could lead to lower borrowing costs for many kinds of loans.

For example, rate cuts could offer some relief to homebuyers who have been priced out of the market by high mortgage rates. The expectation of rate cuts, in and of itself, also helps push mortgage rates down.“The market is moving ahead of the Fed, bringing down longer-term rates including those for mortgages, which should lead to both more home purchases and a pickup in refinance activity," Mike Fratantoni, chief economist at the Mortgage Bankers Association, wrote in a commentary.

The yield on 10-year Treasurys, which is closely tied to mortgages, fell to around 3.80% Friday, the lowest level since last December.

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Nvidia (NVDA) reportedly is facing two separate U.S. Department of Justice (DOJ) antitrust investigations. 

The first probe is connected to the semiconductor giant's April acquisition of Israel-based startup Run:ai, according to a report Thursday, which cites "five people with direct knowledge of the matter." Run:ai specializes in the visualization of graphics processing units (GPUs), and its technology enables Nvidia's clients to do more with fewer chips, the report said. 

The second is investigating whether Nvidia is putting pressure on customers not to buy its rivals' products, as reported by Thursday. The DOJ has reached out to "several" of Nvidia's competitors, including Advanced Micro Devices (AMD), "to gather information about the complaints," the report said, citing "two people involved in the discussions." 

Nvidia insists it isn’t operating illegally. 

“NVIDIA wins on merit, as reflected in our benchmark results and value to customers,” a spokesperson told . “We compete based on decades of investment and innovation, scrupulously adhering to all laws, making NVIDIA openly available in every cloud and on-prem for every enterprise, and ensuring that customers can choose whatever solution is best for them. We’ll continue to support aspiring innovators in every industry and market and are happy to provide any information regulators need.”

The DOJ didn't immediately respond to an request for comment Friday.

Shares of Nvidia fell 3% to $105.75 as of 3 p.m. ET Friday as the tech selloff continued. Still, the stock has more than doubled in price so far in 2024.

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GoDaddy (GDDY) shares surged Friday, a day after the company raised its 2024 revenue guidance after the bell.

The internet domain company now expects full-year revenue of between $4.525 billion and $4.565 billion, up from its prior range of $4.50 billion to $4.56 billion and representing year-over-year growth of about 7% at the midpoint.

In the second quarter, GoDaddy posted earnings per share (EPS) of $1.01 on revenue of $1.12 billion, roughly in line with consensus expectations of analysts polled by Visible Alpha. Total bookings were $1.26 billion, up 11% year-over-year.

"We are making progress on our key initiatives, including growing discovery and engagement of our AI-powered experience, GoDaddy Airo," Chief Executive Officer (CEO) Aman Bhutani said. 

Shares of GoDaddy climbed more than 6% to $150.54 as of 2 p.m. ET Friday. They have gained about 42% this year.

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U.S. equities cratered at midday Friday after the government reported fewer jobs were created in July than expected, raising concerns about the strength of the U.S. economy. The Dow and S&P 500 lost about 2%, and the Nasdaq sank nearly 3%.

Intel (INTC) shares plunged after the chipmaker reported a wider-than-expected loss and announced it would slash 15% of its workforce in an effort to cut costs. The news dragged down other semiconductor stocks as well.

Amazon (AMZN) shares sank as the online retailer’s revenue and guidance were short of forecasts on weaker-than-anticipated consumer purchases.

Shares of Snap (SNAP) plummeted after the operator of the Snapchat social media platform also posted revenue and guidance that missed expectations, citing a softer advertising environment. 

Apple (AAPL) shares were higher after the iPhone maker's iPad sales and services revenue jumped.

Shares of GoDaddy (GDDY) advanced as the internet domain registrar beat sales estimates and boosted its outlook, citing strong demand.

Clorox (CLX) shares rose after the cleaning products maker exceeded earnings expectations on higher prices and cost cuts. 

Oil and gold futures dropped. The yield on the 10-year Treasury note tumbled. The U.S. dollar lost ground to the euro, pound, and yen. Prices for most major cryptocurrencies fell. 

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Shares of Spirit Airlines (SAVE) fell further Friday, a day after the budget airline said it would furlough about 240 pilots and reported a wider-than-forecast quarterly loss.

Spirit on Thursday posted a $192.9 million second-quarter loss, far larger than the $2.3 million loss in the prior-year period, and said the furloughs would take effect starting Sept. 1. Shares closed more than 8% lower and were down a further 3% to $2.69 as of 10:45 a.m. ET Friday.

Smaller airlines like Spirit have been struggling with soaring costs in a domestic airline industry dominated by four big players: American Airlines (AAL), Delta Air Lines (DAL), Southwest Airlines (LUV), and United Airlines (UAL). Last week, Southwest said it would abandon its longtime policy of open seating in an effort to "increase revenue opportunities" amid pressure from activist investor Elliott Investment Management.

A $3.8 billion merger with rival JetBlue (JBLU) that would have given Spirit more heft was called off in March after a federal judge blocked the deal.  

Earlier this week, Spirit announced plans to offer more premium services as it aims to boost revenue.

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