NEW YORK: US stock indexes extended losses for a second day on Friday as elevated US Treasury yields dragged growth shares after stronger-than-expected jobs data amplified investor fears of bigger interest rate hikes to tame surging prices.

The Labor Department’s report showed nonfarm payrolls increased by 428,000 jobs in April, while economists polled by Reuters had expected 391,000 job additions.

Unemployment rate remained unchanged at 3.6% in the month, while average hourly earnings increased 0.3% against forecast of a 0.4% rise. The data underscored the economy’s strong fundamentals despite a contraction in gross domestic product in the first quarter.

“No big surprises from today’s jobs report – it largely confirms that the labor market remains tight, affording the Fed the flexibility to tackle its price stability mandate head-on,” said Jason Pride, chief investment officer of private wealth at Glenmede.

“Wage growth came in slower and below expectations... but one month does not yet make a trend consistent enough for the Fed to slow its monetary tightening intentions.” Nine of the 11 major S&P sectors declined in early trading, with consumer discretionary sector down 1.7%.

The tech-heavy Nasdaq slid 1.6%, adding to a near 5% drop in the previous session, as investors feared bigger rate hikes might be announced as inflation runs at a four-decade high.

Traders see a 75% chance of a 75 basis point hike at the Fed’s June meeting, despite Fed chief Jerome Powell ruling it out.

Megacap growth stocks Google-parent Alphabet Inc, Apple Inc, Microsoft Corp, Meta Platforms , Tesla Inc and Amazon.com fell between 0.1% and 1.8%.

The yield on the benchmark 10-year Treasury notes rose to 3.131%.

Returns and valuations of interest-rate sensitive growth stocks are discounted more deeply when bond yields rise.

The Cboe volatility index, a measure of investors’ anxiety, spiked 3.74 points to 34.94 as the three major averages looked to close out their fifth straight weekly decline.

At 10:08 a.m. ET, the Dow Jones Industrial Average was down 375.98 points, or 1.14%, at 32,621.99, the S&P 500 was down 55.62 points, or 1.34%, at 4,091.25, and the Nasdaq Composite was down 192.64 points, or 1.56%, at 12,125.06.

The S&P 500 growth index was down 21.7% year-to-date compared with a 6.1% fall in its value counterpart, which houses economy-sensitive sectors such as energy, banks and industrials.

Under Armour Inc slumped 24.3% after the sportswear maker forecast downbeat full-year profit, as it grapples with higher transportation costs and a hit to its business from renewed COVID-19 curbs in China.

Shares of rival Nike Inc slipped 5.4%.

Declining issues outnumbered advancers for a 5.51-to-1 ratio on the NYSE. Declining issues outnumbered advancers for a 4.73-to-1 ratio on the Nasdaq.

The S&P index recorded one new 52-week high and 58 new lows, while the Nasdaq recorded 9 new highs and 598 new lows.