U.S. STOCKS RALLY TO RECORDS AMID BLEAKER JOBS DATA
Stocks rallied to more records on Wall Street Friday (Saturday, May 8, 2021, in Manila) as a stunningly disappointing report on the nation’s job market signaled to investors that interest rates will likely stay low.
The S&P 500 rose 0.7%, topping the previous all-time high set last month. The Dow Jones Industrial Average set a record high for the third straight day, Sran Choe, Damian J. Troise and Alex Veiga reported for the Associated Press (AP).
The S&P 500 index rose 30.98 points to 4,232.60, its third straight gain. The Dow Jones Industrial Average gained 229.23 points, or 0.7%, to 34,777.76. The Nasdaq composite picked up 119.39 points, or 0.9%, to 13,752.24. Small company stocks also got a solid bump. The Russell 2000 index outgained the major stock indexes, climbing 30.21 points, or 1.4%, to 2,271.63.
Technology companies accounted for a big share of the broad rally, which included solid gains by stocks in the energy, industrial, and consumer discretionary sectors.
The gains helped the S&P 500 notch its eighth weekly gain in the last 10 weeks. Voices up and down Wall Street acknowledged that Friday morning’s jobs report was a massive disappointment.
It’s usually the market’s most anticipated economic data of each month, and it showed employers added just 266,000 jobs in April. That was far fewer than the 975,000 jobs that economists expected and a steep slowdown from March’s hiring pace of 770,000.
“It was a bit of a shock when that headline number hit, but you realize most of, if not all of it, is the result not necessarily of demand, but supply,” said Peter Essele, head of portfolio management for Commonwealth Financial Network.
”There seems to be a bit of a labor shortage at the moment.”
The weak report jolted the bond market and initially sent yields tumbling. The yield on the 10-year Treasury briefly dropped below 1.49%, toward its lowest level in two months before recovering. By the market’s close it was unchanged from 1.56% late Thursday.