SP 500, Dow close at record highs as solid jobs data boosts cyclicals

4 months ago 144

The Dow Jones Industrial Average rose 144.78 points, or 0.41%, to 35,209.03, the S&P 500 gained 7.49 points, or 0.17%, to 4,436.59 and the Nasdaq Composite dropped 59.36 points, or 0.4%, to 14,835.76.

Reuters

August 07, 2021 / 08:05 AM IST

The Dow and the S&P 500 indexes closed at record highs on Friday following a stronger-than-expected jobs report, while investors shrugged off concerns over the Delta variant impacting a nascent economic recovery.

Nonfarm payrolls increased by 943,000 jobs last month, a Labor Department report showed. Economists polled by Reuters had forecast payrolls would increase by 870,000 jobs. read more

The Labor Department's closely watched employment report also showed strong wage gains, as employers competed for scarce workers, and a drop in the unemployment rate to a 16-month low. read more

"I think that investors are now saying we’ve got renewed confidence in the economic recovery,” said Sam Stovall, chief investment strategist at CFRA. “And as a result, (investors) are rotating again into the cyclical, the value stocks, as well as the smaller-cap issues”.

Around half of the 11 major S&P 500 sectors rose, with financials leading the growth. The S&P 500 technology sector index (.SPLRCT) fell.

Although the three main indexes gained for the week following a stellar corporate earnings season, fears of higher inflation resulting in a sudden tapering in monetary policy have hurt sentiment.

A trader works on the trading floor at the New York Stock Exchange in Manhattan, New York City, U.S., August 5, 2021. REUTERS/Andrew Kelly

Focus now turns to a meeting of Federal Reserve leaders in Jackson Hole, Wyoming, later this month to discuss policy and decide future stimulus strategy.

The Dow Jones Industrial Average rose 144.78 points, or 0.41%, to 35,209.03, the S&P 500 gained 7.49 points, or 0.17%, to 4,436.59 and the Nasdaq Composite dropped 59.36 points, or 0.4%, to 14,835.76.

On the earnings front, American International Group Inc rose after it beat second-quarter profit estimates on Thursday. read more

Zynga Inc tumbled after issuing a disappointing forecast for bookings and announcing a potential acquisition worth over half a billion dollars. read more

Corteva Inc rose after raising its net sales forecast for the year. read more

Analysts expect second-quarter profit growth of 92.9% for S&P 500 companies, according to IBES data from Refinitiv. Of the 427 companies in the index that have reported earnings so far, 87.6% beat analyst expectations, the highest on record.

In other corporate news, shares of Robinhood Markets Inc soared on Friday after a roller-coaster week that has made the online brokerage among the hottest of so-called meme stocks, adding billions to its value. read more

Read Entire Article