Off The Wire
Wall Street jumps on surprise improvement in labor market
(Reuters) - U.S. stock indexes jumped on Friday, with the Nasdaq Composite less than 1% away from a record high, on hopes of a faster economic rebound from a coronavirus-led slump after data showed surprise job additions in May.
Data from the Labor Department showed nonfarm payrolls rose by 2.509 million jobs last month after a record plunge of 20.687 million in April, and the unemployment rate unexpectedly fell to 13.3% in May from 14.7% in April.
“Today was a shocking jobs number and for the first time this year it was a positive shock,” said Chris Zaccarelli, chief investment officer with Independent Advisor Alliance in Charlotte, North Carolina.
“At 13.3%, we are still at a higher rate than any that we hit during the financial crisis in 2007-2009, but as long as that continues to move lower, it will show that the reopening of the economy is proceeding smoothly.”
The S&P 500 banks sub-index, considered interest-rate sensitive, jumped 5.8% as U.S. Treasury yields rose after the data. [US/]
Boeing Co gained 14.4%, the biggest boost to the Dow Jones index, on hopes of a pickup in air travel a day after American Airlines Group Inc and United Airlines said they would boost their U.S. flight schedule next month.
The NYSE ARCA Airline index also jumped 12.2%.
All major S&P 500 sector indexes rose, with the energy sub-index’s leading gains with a jump of 7.2%, while the defensive consumer staples index added the smallest gains.
Wall Street has rebounded sharply from a coronavirus-driven crash in March as investors bet on a revival in business activity following the easing of a nationwide lockdown.
The S&P 500 and Dow Jones indexes are now down about 6% and 8%, respectively, from their all-time highs.
At 11:09 a.m. ET, the Dow Jones Industrial Average was up 868.73 points, or 3.31%, at 27,150.55, the S&P 500 was up 81.85 points, or 2.63%, at 3,194.20 and the Nasdaq Composite was up 183.41 points, or 1.91%, at 9,799.22.
Fears of more disruptions from social unrest have also eased in the past two days, with the largely peaceful protests against the killing of a black man in police custody waning into Friday morning and emergency curfews in many cities being lifted.
Vaccine maker Novavax Inc jumped 3.7% after saying it would receive up to $60 million from the U.S. Department of Defense to fund manufacturing of its COVID-19 vaccine candidate.
Tiffany & Co jumped 8% after Reuters reported the French luxury goods giant LVMH is not seeking to renegotiate its $16.2-billion takeover deal after deliberating whether to do so.
Advancing issues outnumbered decliners by a 7.13-to-1 ratio on the NYSE and by a 4.24-to-1 ratio on the Nasdaq.
The S&P index recorded 22 new 52-week highs and no new low, while the Nasdaq recorded 70 new highs and one new low.
Reporting by Devik Jain and Shreyashi Sanyal in Bengaluru, additional reporting by Pawel Goraj in Gdansk; Editing by Shounak Dasgupta and Uttaresh.V