US stocks advanced Friday to close out the trading week as weaker September hiring reduced bets on a Federal Reserve rate increase in October, but Treasuries erased their initial rally. The 10 year Treasury yield rebounded to 5.26% after falling as low as 5.15%. Bitcoin briefly climbed above $87,000 before giving back about $2,000 of those gains. CME FedWatch showed October rate hike odds near 17%.

Employers added 29,000 jobs, below the 84,000 expected by economists surveyed by Dow Jones, and July and August payrolls were revised down by a combined 60,000. Unemployment rose to 4.2% from 4.1%. Average hourly earnings increased 0.1% in September and 3% from a year earlier, the slowest annual pace since 2021.

The separate household survey showed employment rising by 406,000, while the labor force expanded by 485,000, helping explain the increase in unemployment. Participation climbed to 61.8% from 61.6%. September consumer price data are due Oct. 14, ahead of the Fed's Oct. 28 policy meeting.