By Alexander Osipovich and Avantika Chilkoti
U.S. stocks and government-bond yields rose Friday after a
surprisingly upbeat monthly jobs report signaled strength in the
U.S. economy, offsetting some of the jitters about trade that
rattled investors earlier in the week.
The Dow Jones Industrial Average advanced 337.27 points, or
1.2%, to 28015.06. The S&P 500 added 28.48 points, or 0.9%, to
3145.91, and the Nasdaq Composite rose 85.83 points, or 1%, to
Employers added 266,000 jobs in November and unemployment
matched a 50-year low of 3.5%, signs the U.S. economy is
withstanding a global slowdown. Those numbers beat the projections
of economists surveyed by The Wall Street Journal who estimated
nonfarm payrolls increased by 187,000 and the unemployment rate
remained at 3.6%.
Haven assets like gold and Treasurys slid, lifting the yield on
the benchmark 10-year U.S. Treasury note to 1.842%, from 1.795% on
Thursday, and sending gold futures down 1.2%.
"It's a very solid jobs report," said Michael Arone, chief
investment strategist at State Street Global Advisors. "Since
August you have seen recession fears recede, and this report
continues to show that the U.S. economy is on a firm footing."
Household spending has proved to be crucial this year for U.S.
economic growth, though the Federal Reserve has also cut rates
three times to help bolster output amid rising fears of a global
The jobs report suggests that the Fed will keep interest rates
on hold for the foreseeable future, analysts said. The key
rate-setting committee of the U.S. central bank is set to meet next
week, but Fed watchers expect it to keep rates steady in light of
the positive economic data and its cuts earlier this year.
Meanwhile, new survey data released Friday showed Americans'
economic outlook has improved in recent weeks. The University of
Michigan's main index of consumer sentiment was 99.2 in early
December, higher than the 96.8 reading in late November. Consumer
spending has been one of the primary reasons for the resilience of
the U.S. economy this year.
U.S.-China trade talks also remain in the spotlight for markets
ahead of the Dec. 15 deadline for new tariffs on consumer goods to
At the end of a week that has seen markets react to conflicting
signals on the progress of negotiations, China's State Council on
Friday began the process of exempting some soybeans and pork
imported from the U.S. from punitive tariffs, the state-run Xinhua
News Agency said.
"I don't think there will be anything signed by the 15th, but
they may well kick it into next year," said Tom Roderick, a
portfolio manager at London-based hedge fund Trium Capital, adding
that "both sides are playing nice at the moment" with little
incentive to escalate tariffs.
Despite a rough start to December, major U.S. stock indexes are
trading just below their records from late last month. Friday's
rally helped the S&P 500 secure a modest weekly gain. The Dow
industrials and the tech-heavy Nasdaq Composite were in the red for
President Trump lauded the stock market's 2019 rally just before
the jobs report, saying on Twitter, "Stock Markets Up Record
Numbers. For this year alone, Dow up 18.65%, S&P up 24.36%,
Nasdaq Composite up 29.17%. 'It's the economy, stupid.'"
Shares of Ulta Beauty surged $26.18, or 11%, to $262.20 after
the cosmetics company reported higher sales in the latest quarter
and raised its earnings forecast.
Zoom Video Communications tumbled $6.93, or 10%, to $62.74 after
it reported quarterly revenue that exceeded analysts' forecasts,
but fell short of some investors' lofty expectations. Several
analysts cut their price targets for the videoconferencing company,
which went public in April in one of the year's hottest initial
In commodities, U.S. crude oil futures rose 1.3% to $59.20 a
barrel after Saudi Arabia and other large oil-exporting countries
signaled that they would cut production.
Overseas, the benchmark Stoxx Europe 600 index climbed 1.2%. In
Asia, the Shanghai Composite Index gained 0.4%, while the Hang Seng
U.K. markets remained volatile ahead of a general election next
week. The FTSE 100 rallied 1.4% on Friday, lifted by the U.S. jobs
data and speculation that Prime Minister Boris Johnson's
Conservative Party will win the vote. Such an outcome would reduce
uncertainty around the U.K.'s withdrawal from the European
"The way the polls look at the moment, it's not going to be a
narrow majority open to hostage-taking," said Mr. Roderick.
Write to Alexander Osipovich at email@example.com
and Avantika Chilkoti at Avantika.Chilkoti@wsj.com
(END) Dow Jones Newswires
December 06, 2019 16:52 ET (21:52 GMT)
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