Sun, May 07, 2017 - Page 14 News List

S&P 500 hits record on US job growth

OPTIMISM:The confirmation that the US economy is improving helped the broader market, Horizon Investment Services chief executive officer Chuck Carlson said

Reuters, NEW YORK

A trader works on the floor of the New York Stock Exchange on Thursday.

Photo: Reuters

Major US stock indices on Friday gained, with the S&P 500 ending at a record-high close, as energy stocks bounced back along with oil prices and US job growth rebounded.

US non-farm payrolls last month surged by 211,000 jobs after a paltry gain of 79,000 in March and the unemployment rate dropped to 4.4 percent, near a 10-year low.

Energy was the best performing sector, rising 1.6 percent, after falling sharply a day earlier.

Oil prices rebounded following assurances by Saudi Arabia that Russia is ready to join OPEC in extending supply cuts.

“There has been and probably will continue to be a little bit of a fear that perhaps the economy isn’t accelerating like people thought it would or want it to,” said Chuck Carlson, chief executive officer at Horizon Investment Services LLC in Hammond, Indiana.

“So any day where you get a little bit more confirmation that perhaps the economy is okay — and we got that today in the sense of an okay jobs report, oil is up, transports are doing better today — that probably is something that helped the broader market,” Carlson said.

The Dow Jones Industrial Average rose 55.47 points, or 0.26 percent, to 21,006.94, the S&P 500 gained 9.77 points, or 0.41 percent, to 2,399.29 and the NASDAQ Composite added 25.42 points, or 0.42 percent, to 6,100.76.

For the week, the Dow rose 0.3 percent from 20,940.51, the S&P gained 0.6 percent from 2,384.20 and the NASDAQ Composite rose 0.9 percent from 6,047.61.

After seven sessions of not moving more than 0.2 percent in either direction, the S&P 500 on Friday eclipsed that range as stocks strengthened late in the day.

The S&P 500 has gained 12.1 percent since US President Donald Trump’s Nov. 8 last year election, fueled by his plans for tax cuts, infrastructure spending and deregulation.

However, the rally had slowed as some investors questioned Trump’s ability to enact his agenda.

The US Federal Reserve left interest rates unchanged at its policy meeting this week.

The central bank downplayed weak first-quarter economic growth while emphasizing the strong labor market, in a sign it was still on track for two more rate rises this year.

Investors are pricing in a 75 percent chance of a hike in June, according to Thomson Reuters data.

In corporate news, IBM Corp shares fell 2.5 percent after Warren Buffett said he sold about one-third of Berkshire Hathaway Inc’s stake in the company.

Earnings season has come in generally above expectations, encouraging investors.

Shares of health insurer Cigna Co and IT services provider Cognizant Tech Solutions Corp rose after their respective reports.

Advancing issues outnumbered declining ones on the New York Stock Exchange by a 2.66-to-1 ratio; on NASDAQ, a 1.39-to-1 ratio favored advancers.

The S&P 500 posted 55 new 52-week highs and no new lows; the NASDAQ Composite recorded 123 new highs and 67 new lows.

About 6.5 billion shares changed hands in US exchanges on Friday, just below the 6.6 billion daily average over the past 20 sessions.

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