By Peter McKay
Stocks hit new intraday highs Friday afternoon, in a rally
sparked by employment numbers that boosted investors' confidence in
the broader U.S. economy.
The Dow Jones Industrial Average (DJI) was up 125 points, or
1.2%, at 10,569, less than 3 points off its intraday peak heading
into the close. The average was led Friday by gains of more than 3%
each in Alcoa Inc. (AA), Boeing Co. (BA) and American Express Co.
(AXP)
In the week's key economic release, the Labor Department said
nonfarm payrolls fell by 36,000 in February, compared with a
revised 26,000 drop in January. Economists were expecting a
February drop of about 75,000, partly due to severe weather. The
unemployment rate held steady at 9.7%, better than the 9.8% rate
economists expected.
The jobs report comes on the heels of recent readings of
manufacturing, service-sector activity and retail sales that also
have shown improvement, reinforcing the view of many traders and
analysts that the U.S. economy is staging a gradual comeback.
and
"These are good numbers, especially when you consider all the
apprehension that was out there beforehand," with many analysts
anticipating that harsh February weather would limit hiring, said
head trader David Bellantonio of Instinet, a New York brokerage.
"It may be the sort of thing the market can build on, but we'll
have to see."
The Nasdaq Composite Index (RIXF) was up 1.5%, helped by a 4%
gain in Apple Inc. (AAPL) after the electronics maker said its iPad
tablet would be available in the U.S. on April 3.
The S&P 500 Index (SPX) gained 1.4%.
Shares of Monster Worldwide Inc. (MWW) and other staffing and
job-search companies gained on the jobs report. Monster jumped 4.1%
while Robert Half International Inc. (RHI) climbed 3.9% and
Manpower Inc. (MAN) climbed 3.5%.
Traders commented that a more promising market trend would be to
see steady gains on heavy volume, suggesting deep conviction to
fuel a prolonged trend over weeks or months.
"I think we could see some sideways action next week to
consolidate some of these gains," said Tom Alexander, president of
Alexander Trading. "There are still a lot of disbelievers to this
rally, no question."
Composite volume in New York Stock Exchange-listed companies
recently hit 2.6 billion shares, on track to fall shy of the 2010
daily average around 5 billion.
Commodity prices also benefited from optimism about the economy,
with traders betting on increased demand. Crude futures approached
$82 a barrel, and the broad Dow Jones-UBS Commodity Index was up
0.6%.
News from overseas was more of a mixed bag for investors. The
Greek parliament approved an austerity package of 4.8 billion
euros, or $6.52 billion, seen as a prelude to any European Union
aid for Greece, while thousands of union members protested the
measures on the streets outside.
Prime Minister George Papandreou is embarking on a five-day tour
of foreign capitals to persuade fellow E.U. leaders to back Greece
as it faces one of its worst economic crises in its modern history.
and
China's government announced a conservative budget for 2010 that
reinforces its gradual shift away from stimulus programs adopted
during the financial crisis, even as officials said they were still
committed to supporting economic growth.
Meanwhile, a report from the Nikkei newspaper said the Bank of
Japan may take further easing measures, news that sent the Nikkei
225 up in Tokyo and lifted the dollar against the Japanese yen.
and
The U.S. Dollar Index, which measures the greenback vs. a basket
of six overseas denominations, was flat. The cost of one euro rose
to $1.3609, up from $1.3591 late Thursday.
Treasury prices fell. The benchmark 10-year note was off 22/32
to yield 3.689%.