Dow rises 100 points despite a disappointing jobs report, on track for best week since November
U.S. stocks rose on Friday, with the major averages trying to finish their best week since November, as investors hoped a disappointing January jobs report would increase the likelihood of further stimulus.
The Dow Jones Industrial Average jumped 100 points. The S&P 500 rose 0.5% and the Nasdaq Composite climbed 0.2% after both closing at record highs in the previous session. The 30-stock Dow and the S&P 500 are on track to post their fifth straight positive day.
The Labor Department said the U.S. added 49,000 jobs in January, slightly below the 50,000 payrolls expected by economists. The unemployment rate fell to 6.3%, better than projections of 6.7%. December’s numbers were revised much lower, with the month posting a loss of 227,000 from the initial reading of 140,000 jobs lost.
“The jobs number was particularly underwhelming as far fewer jobs were expected,” said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance. “Ultimately, the stock market is anticipating continuing healing in the economy and has been moving higher because of Federal stimulus, which arguably is the bigger story.”
The Senate passed a budget resolution early Friday, as Democrats move forward with the process to pass a $1.9 trillion coronavirus relief bill without Republican votes. The package includes $1,400 stimulus checks, a supplemental jobless benefit and Covid-19 vaccine and testing funds.
With a streak of gains this week, the major averages are on pace for their best weekly performance since November. The blue-chip Dow has gained 2%, while the S&P 500 and the Nasdaq have risen 4.6% and 5.6%, respectively. The market rebounded from last week’s sharp losses as the speculative trading frenzy dissipated.
“The rally’s three pillars actually got stronger: Q4 earnings continue to dramatically exceed expectations, more stimulus is being poured into the economy, and the vaccination pace is accelerating,” Adam Crisafulli, founder of Vital Knowledge, said in a note.
Wall Street is in the middle of a solid earnings season. Of the 184 companies in the S&P 500 that have reported earnings to date, 84.2% topped analyst expectations, according to Refinitiv.
Subscribe to CNBC PRO for exclusive insights and analysis, and live business day programming from around the world.
— CNBC’s Maggie Fitzgerald contributed reporting.
Correction: A previous version misstated the initial reading of December’s jobs report. It also misstated which stock indexes are on track to post their fifth straight positive day. The indexes are the S&P 500 and the Dow.
