Stocks are rising Friday afternoon following a U.S. jobs report that was much stronger than expected. That was a relief for the market after a weak report for May made some investors worry the U.S. economy is slowing down. Stocks are on track for their highest finish in almost a year.
KEEPING SCORE: The Dow Jones industrial average surged 249 points, or 1.4 percent, to 18,144 as of 2:25 p.m. Eastern time. The Standard & Poor’s 500 index rose 31 points, or 1.5 percent, to 2,128, on pace for its highest close since last July 20. The Nasdaq composite advanced 77 points, or 1.6 percent, to 4,953.
US JOBS RELIEF: Employers added 287,000 jobs in June, according to a Labor Department report. The unemployment rate rose slightly as more people looked for work, and there was evidence that wages were rising faster. That suggests the economy is recovering from a slump the last few months. April’s somewhat disappointing hiring number was revised higher while May’s weak figures were cut even further. The April and May reports worried investors in part because they came after the economy grew just 1.1 percent in the first three months of 2016. The U.S. economy has been growing for more than six years and investors are wary that that streak could end.
GAP GAINS: Retailer Gap climbed after it said sales at older stores grew in June as Old Navy results improved. Sales at those stores are considered an important measure of retailers’ results, and Thomson Reuters said it was the first improvement in that gauge for Gap in more than a year. Analysts expected another decline this month.
Gap stock rose $1.21, or 5.6 percent, to $22.86. The stock is down 8 percent this year.
POLYCOM GOES PRIVATE: Videoconferencing equipment maker Polycom said it will be taken private by Siris Capital. It accepted an offer from Siris worth $12.50 per share, or $1.7 billion. Polycom accepted an offer from Mitel Networks in April. Polycom stock gained $1.40, or 12.8 percent, to $12.27. Mitel, which will get a $60 million payment from Polycom, climbed $1.11, or 18.4 percent, to $7.13.
THE QUOTE: Kate Warne, investment strategist for Edward Jones, said the report landed in a sweet spot for the market. While it showed employers are still hiring more workers, it won’t push the Federal Reserve to raise interest rates too soon. Investors have long worried that if interest rates rise too much and too soon, it will hamper economic growth.
“It was a strong report and it put to bed worries that we were seeing the job market sputter,” she said. “It was certainly a sign that the economy continues at a solid pace but not so strong as to force the Fed to move any quicker.”
BONDS: With interest rates likely to stay low, bond yields remained near record lows. The yield on the 10-year Treasury note fell to 1.37 percent from 1.39 percent. The yield on the 30-year Treasury bond dipped to 2.11 percent from 2.14 percent. Both have set all-time lows in recent days.
JUNO STUDY: Drug developer Juno Therapeutics said it halted a mid-stage study on a potential leukemia treatment following the deaths of two patients. The study involved the company’s most advanced experimental drug, and Juno said the deaths of the patients came after an additional chemotherapy drug was added to their treatment. The stock sank $12.42, or 30.4 percent, to $28.40.
HEAVY METAL: Material and machinery companies made the largest gains. Paint and coatings maker PPG added $3.23, or 3.1 percent, to $106.26 and aluminum producer Alcoa picked up 48 cents, or 5.2 percent, to $9.82. Machinery maker Caterpillar climbed $2.20, or 2.9 percent, to $77.25 and aerospace company Boeing gained $2.88, or 2.3 percent, to $130.05.
BARRACUDA GOES SWIMMING: Cloud-based security and storage service company Barracuda Networks reported solid quarterly results and raised its projections for the year. Its stock jumped $2.69, or 17.3 percent, to $18.20.
OIL: Energy prices were slightly higher. Benchmark U.S. crude added 19 cents to $45.33 a barrel in New York. Brent crude, a standard for international oil prices, picked up 35 cents to 46.75 a barrel in London.
METALS: Gold lost $3.70 to $1,358.40 an ounce. Silver picked up 26 cents, or 1.3 percent, to $20.10 an ounce. Copper held steady at $2.12 a pound.
OVERSEAS: Germany’s DAX jumped 2.2 percent and the CAC-40 in France was 1.8 percent higher. In Britain, the FTSE 100 added 0.9 percent. Japan’s Nikkei 225 closed 1.1 percent down. Hong Kong’s Hang Seng index shed 0.7 percent and South Korea’s KOSPI lost 0.6 percent.
CURRENCIES: The dollar dipped to 100.54 yen from 100.76 yen Thursday. The euro declined to $1.1051 from $1.1055.
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