By Mark DeCambre and Anora M. Gaudiano, MarketWatch
Goldman's CEO Blankfein set to retire as the head of the bank as
early as the end of 2018, according to WSJ
U.S. stock benchmarks rallied Friday afternoon as Wall Street
appeared to shake off worries about tariffs on steel and aluminum
to focus a jobs report for February that came in hotter than had
been estimated, as the report signaled a muted rise to wage growth
for the month, helping to ease worries about runaway inflation.
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.
What are the main benchmarks doing?
The Dow Jones Industrial Average rose 374 points to 25,271, a
rise of 1.5%. Meanwhile, S&P 500 index climbed 39 points, or
1.4%, to 2,777, with financials shares surging by 2%, while
technology stocks were up by about 1.6%.
The Nasdaq Composite Index added 106 points, or 1.4%, to 7,534,
trading at a record--the index hasn'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 added 0.5%, while the Dow industrials and
Nasdaq added 0.4% each. The gains came as the markets took
positively the news that Trump signed a steel and aluminum tariff
proclamation, but allowed for some exemptions.
For the week, the S&P 500 is looking at a gain of 3.2%, the
Dow is poised to rise 3%, while the Nasdaq is set to rise 3.8%.
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 could drive the markets?
Investors had been apprehensive after January's upbeat jobs
report was blamed for a meltdown for 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 indications that the U.S. labor market is
tightening up, but the 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 President 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 are 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 headlight number
with only moderate wage growth," said Kristina Hooper, chief global
market strategist at Invesco.
"For a labour 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 are 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 were up 3.9% 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)Shares
of GKN were up 3.3%.
Big Lots Inc.(BIG) shares slid 11% 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 were up
(http://www.marketwatch.com/story/goldmans-blankfein-is-set-to-retire-as-ceo-early-as-2018-according-to-reports-2018-03-09)
1.4% amid a report from The Wall Street Journal report
(http://www.marketwatch.com/story/goldman-ceo-to-step-down-this-year-2018-03-09)that
hinted that CEO Lloyd Blankfein is set to retire by as early as the
end of 2018.
What are other assets doing?
(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 were mixed
(http://www.marketwatch.com/story/german-stocks-fall-as-exports-trump-tariffs-bite-as-european-equities-seesaw-2018-03-09),
while Asian markets closed higher
(http://www.marketwatch.com/story/stocks-in-japan-south-korea-surge-on-news-of-trump-kim-meeting-2018-03-08).
Gold prices were little changed, 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).
The ICE U.S. Dollar Index was seesawing
(http://www.marketwatch.com/story/dollar-seesaws-as-traders-wait-for-jobs-data-to-steer-direction-2018-03-09).
The yield on the 10-year U.S. Treasury rose to 2.90%.
--Barbara Kollmeyer contributed to this article
(END) Dow Jones Newswires
March 09, 2018 14:46 ET (19:46 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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