S&P hits record, Nasdaq rallies as weak jobs data eases Fed taper worries

S&P hits record, Nasdaq rallies as weak jobs data eases Fed taper worries
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NEW YORK/BENGALURU (May 7): The S&P 500 and the Dow Jones Industrials hit record highs on Friday, while the technology-heavy Nasdaq index jumped after weak US jobs data eased worries about the Federal Reserve reducing its massive stimulus program anytime soon.

The Labor Department's closely-watched employment report showed US employers hired far fewer workers than expected in April, with nonfarm payrolls increasing by only 266,000 jobs last month, after rising by 770,000 in March.

Economists polled by Reuters had forecast payrolls advancing by 978,000 jobs. Data also showed unemployment rate rose to 6.1% in April, from 6.0% in March.

Highly valued stocks such as Microsoft Corp, Apple Inc and Facebook Inc rose between 0.3% and 1%.

"One number doesn't make a trend, but it takes some of the heat off the economy overheating and inflation moving dramatically higher," said Larry Adam, chief investment officer at Raymond James.

"This puts less pressure on the Fed to prematurely talk about tapering."

The jobs report alleviated concerns about rising inflation and potentially higher US interest rates which would weigh on the valuations of growth companies.

Ten of the 11 major S&P 500 sectors were higher in early trading, with technology stocks rising 0.7%.

Financials dropped 0.3%, with interest rate-sensitive shares of lenders Bank of America, JPMorgan Chase & Co and Citigroup Inc trading flat to lower. The S&P 500 banks sector fell 0.8%.

At 9:56 a.m. ET, the Dow Jones Industrial Average was up 105.20 points or 0.30% at 34,653.73; the S&P 500 was up 19.24 points or 0.46% at 4,220.86; and the Nasdaq Composite was up 103.45 points or 0.76% at 13,736.29.

The Nasdaq Composite index is set to fall 1.2% this week, its worst weekly decline since early March. The S&P 500 and the Dow Jones Industrial Average indexes, however, are on track for weekly gains.

Payments firm Square Inc rose 5.6% after reporting a better-than-expected quarterly profit, as surging demand for bitcoin fueled a jump in cryptocurrency transactions on its application.

Streaming device maker Roku Inc jumped 14.6% following upbeat revenue outlook, while fitness equipment maker Peloton Interactive gained 6.1% as it laid out steps to improve the safety of the equipment.

Advancing issues outnumbered decliners by a 2.05-to-1 ratio on the NYSE and by a 2.16-to-1 ratio on the Nasdaq.

The S&P index recorded 70 new 52-week highs and no new low, while the Nasdaq recorded 82 new highs and 18 new lows.