mbbirdy
The release of fresh data about the labor market sent major market averages sharply higher in Friday’s trading. A further advance in midafternoon trading allowed all the major averages to show gains of at least 2%.
The Dow (DJI) is +2.1%, the S&P 500 (SP500) is +2.3%, and the Nasdaq Composite (COMP.IND) is +2.5%.
The government’s monthly employment report showed that the U.S. economy added 223K jobs in December, more than economists had predicted. The unemployment rate dipped to 3.5%.
Ahead of the report, economists had anticipated that the jobs report would show that 200K jobs were added during the month. Experts also predicted that the unemployment rate would hold steady at 3.7%.
While the headline numbers continued to point to a strong labor market, potentially raising fears of further Federal Reserve rate hikes, investors viewed some of the report’s secondary statistics in a bullish light. This included signals from average hourly wages and some downward revisions to previous months.
On Thursday, the release of the ADP’s monthly report on private-sector payrolls sent stocks lower, with each of the major averages falling more than 1%. Those stats came in higher than expected, which prompted concerns that the Fed would need to continue its hawkish policy longer than previously expected.
Treasury yields dropped in the wake of the jobs data. The U.S. 10 Year Treasury yield (US10Y) fell 14 basis points to 3.58%. At the same time, the U.S. 2 Year Treasury yield (US2Y) came down by 18 basis points to 4.27%.
In other economic news, ISM service index data came in at 49.6 versus the consensus figure of 55.
Factory orders dropped more than expected in November by -1.8% to $543.3B versus the -0.8% forecasted figure.
Among active stocks, World Wrestling Entertainment (WWE) surged on signs that the wrestling promoter is looking to pursue a sale.
