Jobs report, Broadcom results pose next hurdles for stock market rally

NEW YORK, Aug 28 (Reuters) - A fresh look at the U.S. labor market in the coming week along with quarterly results from semiconductor company Broadcom will test a market rally that has lifted stocks near record highs.

The S&P 500 posted a weekly gain, putting the benchmark index slightly more than ‌1% away from its August 13 all-time high. A blowout quarterly report on Wednesday from AI bellwether and market behemoth Nvidia boosted sentiment for stocks, which had ‌been dented earlier in the month by rising Treasury yields.

Investors were focused on the monthly U.S. employment report, due on September 4, and on whether the jobs data would offer hints about the U.S. Federal Reserve's plans for interest ​rates in coming months.

"As we're starting to get closer to that September (Fed) meeting, each data print is going to be under the microscope as it may inform what the Fed ultimately does," said Michael Reynolds, vice president of investment strategy at Glenmede.

Following a speech by new Fed Chair Kevin Warsh on Friday, investors increased bets that the central bank would hike rates at its next meeting in September, as it grapples with above-target inflation.

With August coming to a close, the S&P 500 was last up more than 12% for the year. Strong corporate profit growth ‌driven by massive spending on the AI infrastructure buildout is fueling ⁠the nearly four-year-old bull run in U.S. equities.

Markets have been relatively calm as summer ends in the U.S. The Cboe Volatility Index hovered near its low point for the year, and daily market trading volume this week was well below its 2026 average.

Several upcoming events could shake assets, ⁠including the jobs data. Employment for August was expected to have climbed by 58,000 jobs, with the unemployment rate at 4.1%, according to a Reuters poll as of Friday.

The July report showed a surprise labor-market weakening, with employment declining by 23,000 jobs.

"The last jobs report gave the market and investors a little bit of pause," said Amanda Agati, chief investment officer of PNC Asset Management Group.

However, Agati said she ​doubted ​there was a breakdown in the labor market, adding she would be looking for "either confirmation of that trend ​that we saw in the last report, or maybe a bounce back ‌to prior months."

The jobs data could also indicate whether the Fed is likely to raise interest rates. Data this week showed inflation continued to run well above the U.S. central bank's 2% annual target.