04:34 PM EDT, 06/07/2024 (MT Newswires) -- US benchmark equity indexes dropped Friday and Treasury yields surged as traders weighed official data showing that May nonfarm payrolls and wage growth topped Wall Street's expectations.

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

For the week, the Nasdaq jumped 2.4%, the S&P gained 1.3% and 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 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 said in a report. "More importantly, the reacceleration 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 16.7 basis points to 4.89% on Friday, while the 10-year rate surged 15.1 basis points to 4.43%.

In company news, GameStop ( GME ) fiscal Q1 sales fell from a year earlier, and the stock fell 39% in a trading frenzy during a livestream from investor Keith Gill, known as Roaring Kitty.

3M ( MMM ) shares rose 2.7%, the biggest gain on the Dow, as BofA Securities upgraded the stock to buy from neutral. The brokerage said it expects William Brown, the new chief executive officer, to refocus on growth and operations.

West Texas Intermediate crude oil fell 0.4% to $75.25 a barrel.

Gold tumbled 3.5% to $2,307 an ounce, while silver plunged 6.7% to $29.27 an ounce.