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US Stocks Rally to New Highs as Weak Jobs Growth Secures Fed's Patience

05/07/2021 12:33

04:21 PM EDT, 05/07/2021 (MT Newswires) -- US stocks set new records Friday after an unexpectedly weak April jobs report quashed speculation that the Federal Reserve might soon begin to reduce its asset purchases.

The S&P 500 rose more than 0.7% to 4,232.60, while the Dow Jones Industrial Average gained a little under 0.7% to 34,777.76. The only major average not at a new high was the Nasdaq Composite, which advanced 0.9% to 13,752.24.

Copper jumped nearly 3% from Thursday's record high to $4.74 per pound, aided by expectations of continued monetary accommodation. Gold rose nearly 1% to $1,832.70 per ounce, while silver rose 6 cents to $27.54 per ounce. West Texas Intermediate crude oil ticked up $0.07 to $64.78 per barrel; natural gas at the Henry Hub rose 3 cents to $2.96 per million BTU.

Energy and basic materials were the best-performing sectors, while consumer staples and financials lagged.

The 10-year US Treasury yield rose 2 basis points to 1.58% after falling as low as 1.52% in the morning on the US Labor Department's lackluster jobs report for April.

Nonfarm employment rose by 266,000 last month, the government reported, far short of market expectations for one million additional jobs. The unemployment rate rose to 6.1% from 6% in March, while the initially reported March gain of 916,000 nonfarm payrolls was revised downward to 770,000.

News Corp. (NWS) was among the top performers on the S&P 500, gaining 6% after reporting fiscal third-quarter results above estimates on strong digital advertising growth.

Spectrum Brands (SPB) closed 3.5% higher after the marketer of Remington shavers, George Foreman grills, and Black Flag insecticide topped its third-quarter estimates and raised annual guidance, citing strong consumer demand aided by fiscal stimulus, and saying it plans price hikes to offset logistics cost pressures.

Supply difficulties took a toll on Monster Beverage (MNST) despite better than expected quarterly results, as the energy drink member scrambled to secure aluminum can supply sufficient to keep up with its growth. Cans are in short supply because of the shift from restaurant to home beverage consumption amid the COVID-19 pandemic. Monster's co-chief executive said he hopes the shortage will ease up by the end of 2021. The stock fell 4% Friday, the most in the S&P 500.

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