- NEW YORK, RAW – The S&P 500 and the Dow have hit record highs while megacap growth stocks drove a recovery on the Nasdaq after US jobs data eased concerns over prospects for rising rates.
US job growth unexpectedly slowed in April, likely restrained by shortages of workers, the Labor Department report on Friday showed.
The report alleviated some concerns about rising inflation and potentially higher US interest rates, which some investors worry would hurt growth companies with high valuations.
“Growth names that were taken to the woodshed are getting another chance because they will be perceived to be less risky in an environment where there is a slower recovery, and that’s really what the jobs data is indicating”, said Tom Martin, senior portfolio manager at Globalt Investments.
Heavily-weighted growth stocks such as Microsoft Corp, Apple Inc and Alphabet all rose but all major S&P 500 sectors also ended in green, with energy and real estate leading the advance.
Energy and materials hit fresh highs earlier.
The Dow Jones Industrial Average rose 227.91 points, or 0.66 per cent, to 34,776.44, the S&P 500 gained 30.81 points, or 0.73 per cent, to 4,232.43 and the Nasdaq Composite added 119.40 points, or 0.88 per cent, to 13,752.24.
“The anticipation and confirmation of (Federal Reserve) policy staying the same and continued economic recovery with vaccines rollout have fuelled these all-time highs but we do believe the volatility is going to be tightened in the short term,” said Greg Bassuk, chief executive at Axs Investments.
A raft of upbeat earnings also helped stocks and S&P 500 earnings are now estimated to have increased 50.4 per cent in the first quarter from a year ago, which would be the highest growth rate since the first quarter of 2010, according to Refinitiv data.
Payments firm Square Inc rose after reporting a better than expected quarterly profit as surging demand for bitcoin fuelled a jump in cryptocurrency transactions on its application.
Streaming device maker Roku Inc jumped following an upbeat revenue outlook while fitness equipment maker Peloton Interactive Inc gained as it laid out steps to improve the safety of its equipment.
Expedia Group Inc shares rose as analysts raised price targets following the company’s upbeat results.
Wall St up as jobs data eases rate worries
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