Friday March 10th

10-03-2017

Stocks rise after strong jobs report; tech and materials lead

U.S. equities rose Friday following a jobs report that topped expectations, while technology and materials outperformed. The Dow Jones industrial average rose about 70 points, with IBM contributing the most gains. The S&P 500 gained 0.4 percent, as tech and materials rose around 0.7 percent.The Nasdaq composite advanced around half a percent. The U.S. economy added 235,000 jobs in February, the Bureau of Labor Statistics said, adding the unemployment rate ticked lower to 4.7 percent. "I don't see any bad numbers in this report," said Scott Clemons, chief investment strategist at Brown Brothers Harriman. "The Fed didn't need permission from the labor market to raise rates next week, but it got it anyway." Investors eagerly awaited for the report, looking for one last item confirming the Federal Reserve would probably raise rates next Wednesday. According to the CME Group's FedWatch tool, market expectations for a March rate hike stood at 93 percent after the data were released. Expectations for tighter monetary policy increased sharply leading up to the jobs report, amid hawkish Fed rhetoric and strong economic data, including the blockbuster ADP and Moody's payrolls report released Wednesday. That said, U.S. Treasury yields and the dollar turned lower after the report came out, with some investors disappointed with the hourly wage growth last month. Hourly wages rose at an annualized rate of 2.8 percent, the BLS said. "The average hourly earnings were a bit disappointing," said Marc Bushallow, managing director of fixed income at Manning & Napier. "People also had some loft expectations for the headline number." The benchmark 10-year note yield fell to about 2.58 percent from around 2.6 percent before 8:30 a.m. ET. The dollar index, meanwhile, slipped to trade 0.2 percent lower to 101.63 from 101.9. "I think we've fallen victim to an exercise where, if we don't beat expectations across the board, then it's bad news," said Brown Brothers Harriman's Clemons. "But that's a sign of how far we've come, I think." Overseas, European stocks traded broadly higher, with the pan-European Stoxx 600 index climbing about 0.4 percent. In Asia, stocks closed mostly higher, with the Nikkei 225 advancing 0.7 percent. Oil prices gave up early gains on Friday after dropping to their lowest in more than three months, pressured by heavy oversupply despite OPEC-led production cuts. Futures briefly extended early morning gains after the Bureau of Labor Statistics reported the United States added 235,000 jobs in February and the unemployment rate ticked down to 4.7 percent. Brent crude oil was down 25 cents at $51.94 a barrel by 10:22 a.m. ET (1522 GMT), after falling 1.7 percent on Thursday and 5 percent the day before in its biggest percentage decline in a year. U.S. crude was down 23 cents at $49.05 a barrel. It fell below $50 on Thursday for the first time since December. U.S. crude is on track for a drop of more than 7 percent this week, its biggest weekly fall for five months. Gold  hit a low of $1,194.55 an ounce on Friday, after slipping below $1,200 an ounce in the previous session for the first time since Jan. 31. Spot gold was up 0.25 percent at $1,203.78 an ounce, while U.S. gold futures for April delivery dipped 0.02 percent at $1,203.