S&P 500 and Dow Jones Industrial Average recorded their fifth consecutive weekly gains
U.S. stock market rose modestly on Friday, 05 September 2014 as investors shrugged off a weaker-than-expected jobs report. The S&P 500 and Dow Jones Industrial Average recorded their fifth consecutive weekly gains. Equity indices slipped from their opening levels, but the S&P 500 found support near the 1990 mark, which served as resistance in July and provided support over the past two weeks. The benchmark index tested the area around 10:45 ET and spent the remainder of the session in a slow climb to new highs.
The Dow Jones Industrial Average gained 67.78 points, or 0.4%, to 17,137.36. The Nasdaq Composite added 20.61 points, or 0.3%, to 4,582.90. The S&P 500 gained 10 points, or 0.5%, to 2,007.71, with all 10 main sectors finishing higher lead by utilities sector.
Non-farm payrolls came in at up 142,000 in the month, which is well below the forecasts calling growth to be up 220,000 in August. The overall unemployment rate declined slightly in August, to 6.1%, which was in line with expectations. The report doused market conjecture that the Fed might consider moving up plans for an interest rate increase at its next meeting in mid-September after a recent flurry of economic data pointed to a strengthening economy.
A surprisingly weak jobs report indicated a marked slowdown in the labor market. However the initial reaction was muted, as investors appeared to focus on the idea that the creation of fewer new jobs than expected won't alter the Federal Reserve's thinking on interest rates.
Thursday's move by the European Central Bank to reduce its already extremely low interest rate and also the initiation of quantitative easing sunk the Euro currency to a 13-month low. Meantime, growing ideas the U.S. Federal Reserve will continue to wind down its QE and even start to raise interest rates as early as the first quarter of 2015 have boosted the U.S. dollar index to a 13-month high.
In overnight news, the European Union's second-quarter gross domestic product report showed a growth rate of 0.0% from the first quarter, and up 0.7% year-on-year, which was in line with expectations and continues a theme of downbeat economic data coming out of the world's third-largest economy.
On the geopolitical front there have been no major, markets-moving developments this week. The Russia-Ukraine stand-off continues to be closely monitored for any escalation.
Among major stocks under focus, Tesla Motors shares fell 3% as investors are pulling back after outsize gains made partially in anticipation of the electric vehicle manufacturer's decision on where to locate its battery factory. Shares of Michael Kors Holdings slid 4.5% after the company's biggest shareholder sold its stake overnight. Gap shares fell 4.2% after the apparel retailer reported disappointing sales for August.
Bullion prices ended little higher at Comex on Friday, 05 September 2014. Gold prices traded moderately higher in the immediate aftermath of a significantly weaker-than-expected U.S. employment report. The Labor Department's employment situation report for August was significantly downbeat Friday morning. Gold prices closed slightly higher on Friday, but gave up most of the gains that came immediately after a soft jobs report sent investors toward safety plays.
Gold for December delivery settled up 80 cents, or less than 0.1%, to $1,267.30 an ounce. December silver rose 2 cents to $19.16 an ounce.
Crude-oil futures fell on Friday, 05 September 2014 at Nymex as a weaker-than-expected U.S. jobs report revived fears of less demand for the commodity. Light, sweet crude futures for delivery in October declined $1.16, or 1.2%, to settle at $93.29 a barrel on the New York Mercantile Exchange. Weekly losses reached 2.8%. Futures are lower for nine of the past 11 weeks.
Treasuries rallied following today's Nonfarm Payrolls report, but surrendered all of their gains during the day. The 10-yr yield ended at 2.45%.
Participation was below average with roughly 600 million shares changing hands at the NYSE.
Monday's economic data will be limited to the Consumer Credit report for July (consensus $17.80 billion), which will cross the wires at 15:00 ET.
Powered by Capital Market - Live News
