By Mark DeCambre and Anora M. Gaudiano, MarketWatch
WSJ: Goldman's CEO Blankfein could retire as early as the end of
2018
The Dow closed back above 25,000 and the Nasdaq ended at a
record on Friday as Wall Street appeared to shake off worries about
tariffs on steel and aluminum to focus on an unexpectedly strong
jobs report.
Read:Is this bull market really 9 years old?
(http://www.marketwatch.com/story/is-this-bull-market-really-9-years-old-2018-03-09)
The U.S. created 313,000 new jobs in February, the biggest gain
since mid-2016 and a reflection of the strongest labor market in
two decades. Economists polled by MarketWatch had predicted a
222,000 increase in nonfarm jobs. The unemployment rate was
unchanged at 4.1%. Hourly pay rose 4 cents, or 0.1%, to $26.75 an
hour, the government said Friday. Economists polled by MarketWatch
(http://www.marketwatch.com/story/are-workers-really-getting-a-raise-wages-are-focus-of-upcoming-us-jobs-report-2018-03-08)
had been expecting average hourly earnings to have risen 0.2%,
after a 0.3% gain in January, with an overall jobs gain of 220,000.
The subdued rise in wage growth for the month helped to ease
worries about runaway inflation.
What did the main benchmarks do?
The Dow Jones Industrial Average surged 440.53 points, or 1.8%,
to end at 25,335.74 for a weekly gain of 3.3%. This is the first
time the blue-chip index closed above 25,000 since Feb. 28.
Also see:In the bull market's ninth year, 'winning' stocks hide
lingering pain
(http://www.marketwatch.com/story/in-the-bull-markets-ninth-year-winning-stocks-hide-lingering-pain-2018-03-09)
The S&P 500 index climbed 47.60 points, or 1.7%, to close at
2,786.57, ending the week 3.5% higher. Financials, industrials and
technology sectors all rallied more than 2%.
The Nasdaq Composite Index added 132.86 points, or 1.8%, to
finish at 7,560.81, up 4.2% for the week. The index hadn't closed
at a record
(http://www.marketwatch.com/story/nasdaq-sets-intraday-record-for-the-first-time-in-6-weeks-marking-a-brisk-rally-for-tech-stocks-since-correction-2018-03-09)
or set an intraday mark since Jan. 26.
On Thursday
(http://www.marketwatch.com/story/nasdaq-set-sights-on-5th-win-in-a-row-as-spotlight-stays-on-tariffs-2018-03-08),
the S&P 500 index advanced 0.5%, while the Dow industrials and
Nasdaq rose 0.4% each. The gains came as the markets took
positively the news that President Donald Trump signed a steel and
aluminum tariff proclamation, but allowed for some exemptions.
Need to know:Go big on stocks as Trump has 1 big reason not to
launch trade war, says quant
(http://www.marketwatch.com/story/go-big-on-stocks-as-trump-has-a-big-reason-not-to-launch-a-trade-war-2018-03-09)
What drove the markets?
Investors had been apprehensive after January's upbeat jobs
report was blamed for a meltdown by stocks last month
(http://www.marketwatch.com/story/dow-futures-tumble-more-than-250-points-on-jobs-day-2018-02-02).
Investors are wary of signs that the U.S. labor market is
tightening up, but the February wage figures appeared to be more
muted than January's report, market participants said.
Rapidly rising inflation could also add pressure on the Federal
Reserve to speed up its rate rises, which could strangle the stock
market.
Data released earlier in the week showed private-sector
employers added a stronger-than-expected 235,000 jobs
(http://www.marketwatch.com/story/labor-market-red-hot-as-adp-says-235000-private-sector-jobs-added-in-february-2018-03-07).
Markets appeared to largely dismiss news that Trump has accepted
an invitation to meet North Korea's leader. The meeting could be
held as early as May, according to a senior South Korean official
who made the announcement at the White House on Thursday evening
(http://www.marketwatch.com/story/trump-accepts-invitation-to-meet-north-korean-leader-kim-jong-un-2018-03-08).
(http://www.marketwatch.com/story/trump-accepts-invitation-to-meet-north-korean-leader-kim-jong-un-2018-03-08)
But the news did give Korean stocks a boost.
Read:How the Trump-Kim meeting news moved markets
(http://www.marketwatch.com/story/how-the-trump-kim-meeting-news-moved-markets-2018-03-09)
Investors were also still taking in reaction to Trump's tariff
announcement, which weighed on Korean steelmakers in Asia.
What were strategists saying?
"You're getting strong jobs with not a lot of wage growth, which
is perfect below expectations. And that's what's sort of powering
the futures right. It's the best of both worlds," said Robert
Pavlik, chief investment strategist at SlateStone Wealth.
"If you had tried to concoct an event that would be good news
for the economy and good for the markets, you would come up with
the kind of jobs report that we got today: solid headline number
with only moderate wage growth," said Kristina Hooper, chief global
market strategist at Invesco.
"For a labor market that we are told is rather tight this is
quite a big number and the fact that we saw wage growth slow to
2.6% from 2.9% would suggest that there is much more slack in this
particular jobs market than most people think," wrote Michael
Hewson, chief market analyst, at CMC Markets UK, in a Friday
note.
"This would suggest that those calls for four rate rises this
year may well be a little bit premature, particularly when you see
the participation rate jump from 62.7% to 63%, as more people
return to the workforce," Hewson said.
Fed speakers and data
"I think we really have the ability to be cautious," said
Federal Reserve President of Chicago Charles Evans during a CNBC
interview on Friday after the jobs report, referring to the Fed's
plan for coming rate increases. Evans isn't presently a voting
member of the Federal Open Market Committee.
The market volatility seen over the past month is a "healthy
realization" by investors that the risks are two-sided, said Boston
Fed President Eric Rosengren on Friday, at the Springfield Regional
Chamber of Commerce
(http://www.marketwatch.com/story/feds-rosengren-says-markets-waking-up-to-risk-growth-could-be-unsustainably-strong-2018-03-09)
in Springfield, Mass.
Opinion:This is what the Fed Model says about the outlook for
stocks as the bull market turns 9
(http://www.marketwatch.com/story/this-is-what-the-fed-model-says-about-the-outlook-for-stocks-as-the-bull-market-turns-9-2018-03-09)
Meanwhile, wholesale inventories rose by 0.8% in January, up
from 0.4% before.
Which stocks were in focus?
(http://www.marketwatch.com/story/european-stocks-rise-for-4th-day-in-a-row-as-ecb-steals-focus-from-us-tariffs-2018-03-08)Dana
Inc.(DAN) shares jumped 3.6% after announcing a deal to combine
with GKN PLC's (GKN.LN) Driveline unit in a deal valued at around
$6.1 billion, including debt
(http://www.marketwatch.com/story/dana-to-combine-with-driveline-division-of-uks-gkn-in-deal-valued-at-61-billion-2018-03-09).
Big Lots Inc.(BIG) shares skidded 10% after fourth-quarter
results
(http://www.marketwatch.com/story/big-lots-stock-tumbles-as-surprise-same-store-sales-drop-offsets-profit-beat-dividend-hike-2018-03-09).
Goldman Sachs Group Inc. shares rose
(http://www.marketwatch.com/story/goldmans-blankfein-is-set-to-retire-as-ceo-early-as-2018-according-to-reports-2018-03-09)
1.7% after The Wall Street Journal reported
(http://www.marketwatch.com/story/goldman-ceo-to-step-down-this-year-2018-03-09)that
Chief Executive Lloyd Blankfein was preparing to retire as early as
the end of 2018.
How did other assets fare?
(http://www.marketwatch.com/story/european-stocks-rise-for-4th-day-in-a-row-as-ecb-steals-focus-from-us-tariffs-2018-03-08)European
stocks mostly closed higher
(http://www.marketwatch.com/story/german-stocks-fall-as-exports-trump-tariffs-bite-as-european-equities-seesaw-2018-03-09),
while Asian markets were up across the board except India
(http://www.marketwatch.com/story/stocks-in-japan-south-korea-surge-on-news-of-trump-kim-meeting-2018-03-08).
Gold prices settled slightly up, while oil futures
(http://www.marketwatch.com/story/oil-prices-steady-after-us-output-climb-helps-drive-plunge-2018-03-08)moved
sharply higher
(http://www.marketwatch.com/story/oil-ticks-higher-on-potential-us-north-korea-meeting-2018-03-09)
and the ICE U.S. Dollar Index was flat.
The yield on the 10-year U.S. Treasury rose to 2.89%.
--Sue Chang and Barbara Kollmeyer contributed to this
article
(END) Dow Jones Newswires
March 09, 2018 16:40 ET (21:40 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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