04:55 PM EDT, 06/07/2024 (MT Newswires) -- US benchmark equity indexes dropped Friday while Treasury yields surged as traders weighed official data showing that nonfarm payrolls and wage growth topped Wall Street's expectations for May.

The Dow Jones Industrial Average and the Nasdaq Composite fell 0.2% each to 38,799 and 17,133.1, respectively, while the S&P 500 lost 0.1% to 5,347. Among sectors, utilities and materials saw the steepest declines, while financials led the gainers.

For the week, the Nasdaq jumped 2.4%, while the S&P 500 gained 1.3%. The Dow advanced 0.3%.

In economic news, nonfarm payrolls in the US climbed by 272,000 last month, the Bureau of Labor Statistics reported. The consensus was for a 180,000 increase, according to a survey compiled by Bloomberg. Average hourly earnings grew by 0.4% sequentially, ahead of the 0.3% pace modeled by analysts. The annual measure advanced by 4.1%, versus expectations for 3.9% growth.

"The uptick in average hourly earnings will be something closely watched by (Federal Reserve) officials," TD Economics said in a note. "Still elevated wage pressures are helping to sustain strong gains in service spending and are working against the (Fed's) efforts to bring down inflation across the service sector."

Markets widely expect the central bank's Federal Open Market Committee to keep its policy rate unchanged next week and at the end of July, according to the CME FedWatch Tool.

Macquarie said Friday its baseline for the FOMC remains that rate cuts are only likely to begin next year. "On the hawkish side is that the firm NFP and associated details suggest labor demand growth remains solid," the brokerage wrote. "More importantly, the re-acceleration in wage growth reduces the potency of the argument for further disinflation."

In a bid to tame inflation, the FOMC tightened monetary policy by 525 basis points from March 2022 through July 2023. It has kept interest rates unchanged since then.

The US two-year yield jumped 16.9 basis points to 4.89% Friday, while the 10-year rate surged 15.3 basis points to 4.43%.

In company news, GameStop ( GME ) reported lower fiscal first-quarter sales on an annual basis amid the trading frenzy surrounding the video game retailer's stock. The company's shares slumped 39%.

3M ( MMM ) shares rose 2.7%, the best performer on the Dow and among the best on the S&P 500, as BofA Securities upgraded the stock to buy from neutral. The brokerage said it expects the industrial conglomerate's new chief executive, William Brown, to refocus the company on growth and operations.

West Texas Intermediate crude oil fell 0.3% to $75.33 per barrel.

Gold tumbled 3.5% to $2,308.20 per troy ounce, while silver plunged 6.7% to $29.26 per ounce.