Dow jumps greater than 200 factors on a document even after a significant U.S. job report fails

Stocks climbed to record levels on Friday and saw another weekly surge as traders shrugged off a disappointing US job report.

The Dow Jones Industrial Average closed 248.74 points, or 0.8%, at 30,218.26. The S&P 500 gained 0.9% to end the day at 3,699.12. The Nasdaq Composite gained 0.7% to 12,464.23. All three major indices posted intraday and closing record highs.

Chevron and Caterpillar rose 3.9% and 4.3% respectively to keep the Dow higher. Energy was the best performing S&P 500 sector, up 5.4%.

Friday’s jump resulted in big averages for fourth weekly profit in five weeks. The Dow rose 1% this week. The S&P 500 gained 1.7% during this period. The Nasdaq Composite was up 2.2% this week.

The US economy created 245,000 jobs in November. That’s well below a Dow Jones consensus estimate of 440,000. However, the unemployment rate was in line with expectations and fell from 6.9% to 6.7%.

However, some traders viewed the weaker-than-expected number as positive, as it could put pressure on lawmakers to add additional fiscal stimulus.

Friday’s job report data “calls on lawmakers to take additional fiscal stimulus measures to close the output gap in the economy until a vaccine is deployed. The longer they take, the bigger the gap can get,” said Charlie Ripley, Senior Investment Strategist at Allianz Investment Management.

Chuck Schumer, chairman of the Senate minority, tweeted the report. “The report shows that the need for strong, urgent relief is more important than ever.”

President-elect Joe Biden also called for more incentives, noting that Friday’s report anticipated a “dark winter”. Biden later said it was “better if they had the $ 1,200 worth of stimulus checks” and he understands that “this may still be in play”.

JJ Kinahan, chief marketing strategist at TD Ameritrade, noted that the report “wasn’t as bad as it seems,” in part because some of the jobs lost came from the US government when the 2020 census closed.

Kinahan also noted, “It’s really hard to tell what those numbers will be as states move from full closure to full opening. I think you can see that in the market’s reaction.”

Brad McMillan, CIO of the Commonwealth Financial Network, also noted that average hours worked “remained strong” over the past month, “suggesting that overall labor demand remains healthy and the decline in unemployment rates suggests that the labor market is improving further tightened. “

Friday’s report comes as the number of coronavirus cases has risen sharply. The US reported record numbers of new infections, one-day deaths and hospitalizations on Thursday.

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