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Wall Street bounces on robust job additions in April
Wall Street`s main indexes rose steadily on Friday, as a stronger-than-expected job growth in April showed that the U.S. economy continues to expand.
The Labor Department said the U.S. economy added 263,000 jobs in April and the unemployment rate dropped to a more than 49-year low of 3.6%.
However, average hourly earnings came in just shy of expectations, pointing to muted inflationary pressure.
"The economy is looking fairly strong and inflation pressures are subdued, which is bullish for the stock market," said Rahul Shah, chief executive at Ideal Asset Management in New York.
"Risk sentiment is likely to be on because the Fed is likely to remain on hold because you would need to see a string of higher job numbers at this level for the Fed to consider raising rates."
Federal Reserve Chair Jerome Powell`s comments on Wednesday that decline in inflation was likely due to transient factors dampened hopes of an interest rate cut this year, pushing the S&P 500 and the Nasdaq off their record highs.
All three major indexes were set to end the week lower, with the Nasdaq on course for its first weekly decline in five.
At 11:31 a.m. ET the Dow Jones Industrial Average was up 122.47 points, or 0.47%, at 26,430.26, the S&P 500 was up 19.93 points, or 0.68%, at 2,937.45 and the Nasdaq Composite was up 90.98 points, or 1.13%, at 8,127.75.
Also helping gains was a largely positive earnings season. Of the nearly 400 S&P 500 companies that have reported so far, three-quarters have topped profit estimates, according to Refinitiv data.
The upbeat reports have turned around earnings estimate for the first quarter to an almost 1% rise from a 2% decline at the start of April.
All the 11 major S&P 500 sectors were higher, with a 1.23% rise in consumer discretionary stocks powering the gains.
Amazon.com Inc rose 2.9%, after CNBC reported Warren Buffett`s Berkshire Hathaway Inc has bought shares of internet retailing giant for the first time, though he has not been the one doing the buying.
Newell Brand Inc shares jumped 10.6% after the consumer goods maker exceeded Wall Street expectations for quarterly adjusted profit as it benefited from cost savings and higher pricing.
Network gear-maker Arista Networks Inc plunged 15%, the most among S&P 500 companies, after it forecast weak current-quarter revenue.
Activision Blizzard Inc fell 6.4% after the videogame maker forecast current-quarter profit below expectations as it puts more money into its franchises to battle competition.
Advancing issues outnumbered decliners by a 3.74-to-1 ratio on the NYSE and a 3.24-to-1 ratio on the Nasdaq.
The S&P index recorded 24 new 52-week highs and two new lows, while the Nasdaq recorded 61 new highs and 23 new lows.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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