Wall Street Jumps on Surprise Improvement in Labor Market

06 June, 2020
Wall Street Jumps on Surprise Improvement in Labor Market
U.S. stock indexes jumped on Friday, with the Nasdaq Composite less than 1 percent from a record high, on hopes of a faster monetary 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 percent in-may from 14.7 percent 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, NEW YORK.

"At 13.3 percent, we remain at an increased rate than any that people hit during the financial meltdown in 2007-2009, but so long as that continues to go lower, it'll show that the reopening of the economy is proceeding smoothly."

The S&P 500 banks sub-index, considered interest-rate sensitive, jumped 5.8 percent as U.S. Treasury yields rose following the data.
Boeing Co gained 14.4 percent, the biggest boost to the Dow Jones index, on hopes of a pickup in flights a day after American Airlines Group Inc and United Airlines said they might enhance their U.S. flight schedule the following month. The NYSE ARCA Airline index also jumped 12.2 percent.

All major S&P 500 sector indexes rose, with the energy sub-index's leading gains with a jump of 7.2 percent, while the defensive consumer staples index added the smallest gains.

Wall Street has rebounded sharply from a coronavirus-driven crash in March as investors wager on a revival running a business activity following easing of a nationwide lockdown. The S&P 500 and Dow Jones indexes are actually down about 6 percent and 8 percent, 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 percent, at 27,150.55, the S&P 500 was up 81.85 points, or 2.63 percent, at 3,194.20 and the Nasdaq Composite was up 183.41 points, or 1.91 percent, at 9,799.22.

Fears of more disruptions from social unrest also have eased during 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 lots of cities being lifted.

Vaccine maker Novavax Inc jumped 3.7 percent after saying it could receive up to US$60 million from the U.S. Department of Defense to invest in manufacturing of its COVID-19 vaccine candidate. Tiffany & Co jumped 8 percent after Reuters reported the French luxury goods giant LVMH is not wanting to renegotiate its US$16.2 billion takeover deal after deliberating whether to take action.

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, as the Nasdaq recorded 70 new highs and one new low.
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