Stock market updates: Stocks rise to close best week since November despite job decline

Shares rose and reached new record levels after a closely monitored labor market report missed expectations and possibly gave rise to further fiscal stimulus.

Each of the three major stock indices traded higher, with the S&P 500, Dow and Nasdaq having their best weekly gains since November. The S&P 500 rose 4.6% for the week.

Both the S&P 500 and Nasdaq also ended with record highs, and the Dow was approaching its own recent high-time. Friday’s job report in January showed that the U.S. economy returned to adding more jobs than it lost earlier this year, but at a slower pace than expected.

The areas of outperformance in the markets this week fit “into three of the potential rotary trades that we are closely monitoring in 2021,” Kevin Mahn, Hennion & Walsh Investment Manager, told Yahoo Finance on Thursday. The first is smaller cap stocks, which are beginning to outperform larger cap stocks given the exaggerated assessment that large cap stocks are currently trading on … new stocks surpassing U.S. stocks, and then the potential rotation from growth-oriented equity value-oriented equities. “

Over the last five days, the energy sector has been the sector performing best in the S&P 500 as crude oil prices rose again, giving the prospect of a stronger demand for travel and fuel later in the year. The financial sector also outperformed better as government bond yields strengthened. Russell 2000 has also surpassed the S&P 500 this week and so far in 2021, with small-cap stocks typically leading higher during economic recovery. The small cap index hit record highs on Friday, posting its best weekly gain since June.

But while some large stocks and growth stocks may appear high based on some traditional targets, they may also grow into those valuations given the strong earnings performance so far in the fourth quarter, some strategists said. The majority of S&P 500 companies that have reported Q4 results so far have beaten expectations, and many by a wide margin.

“Earnings in the fourth quarter so far are really impressive … a way to improve this P / E ratio [is] prices are going down or earnings are rising, ”Mahn added. “If we continue to see earnings growth, it could also create some more attractive investment opportunities.”

16:00 ET: Stocks close the best week since November as stimulus hopes rise

Here is the settlement of the three major indices on Friday afternoon:

  • S&P 500 (^ GSPC): + 15.06 points (+ 0.39%) to 3,886.80

  • Dow (^ DJI): +92.25 points (+ 0.3%) to 31.148.11

  • Nasdaq (^ IXIC): +78.55 points (+ 0.57%) to 13.856.30

14:10 ET: Stocks hold on gains, pace against strong weekly progress

Here markets traded on Friday afternoon:

  • S&P 500 (^ GSPC): + 15.08 points (+ 0.39%) to 3,886.82

  • Dow (^ DJI): +75.28 points (+ 0.24%) to 31,131.14

  • Nasdaq (^ IXIC): +69.39 points (+ 0.51%) to 13,847.21

  • Raw (CL = F): + $ 0.58 (+ 1.03%) to $ 56.81 a barrel

  • Gold (GC = F): + $ 20.80 (+ 1.16%) to $ 1,812.00 per. Ounce

  • 10-year treasury (^ TNX): +1.8 bps to give 1.157%

11:14 ET: What economists say about the disappointing January job report

In the January job report, net gains were lost as the coronavirus pandemic continued to exert pressure on the entire labor market.

Here is what some economists said about the report in the latest notes and emails to Yahoo Finance on Friday:

  • “There were meaningful downward revisions of -159k over the previous two months, revealing a weaker trend in employment activity and highlighting the stagnant economy at the end of last year … It currently shows a job market entering water, but there are some budding signs of better things to come. ”- Bank of America economists Joseph Song and Alexander Lin

  • “This is not a good start to 2021 … Not only was wage growth slow, but gains were relatively concentrated in certain sectors. Compared to last month, we are adding jobs. However, more industries are throwing jobs in January than adding them. ”- Actual economist Nick Bunker

  • “Some of the inertia in wages seems to be due to seasonal adjustment marks in construction, reported down 3K compared to a trend of approx. + 40K and a decrease of 10K in the manufacturing industry, where the trend is around 35K. We see no reason for the sudden decline in these sectors, and a turnaround in February is a good effort. ”- Pantheon Macroeconomics Economist Ian Shepherdson

10:12 AM ET: GameStop shares rise 50%, triggering trading halt when Robinhood lifts trading restrictions

Shares in GameStop (GME) rose 50% before the day on Friday after Robinhood, the online trading platform popular with retail investors, lifted trading restrictions on the stock. Still, the stock remained well below its all-time high of $ 483.00 from January 28 at the height of the retail investor-driven boom in the stock.

GameStop shares were briefly halted due to volatility between 10:07 and 10:12 ET.

Last week, Robinhood and some other online brokers had set restrictions on trading in GameStop and other highly volatile stocks that had been popularized on the Reddit forum r / wallstreetbets. The company eased these restrictions over the next few days to allow the purchase of a larger number of shares of each of these stocks.

As of Friday morning, there were no trading limits for shares available for trading Robinhood, according to a company statement.

9:52 AM ET: US trade deficit hits its highest level since 2008 in 2020

The US trade deficit widened to a maximum of 12 years last year, as the pandemic weighed heavily on international trade, and imports recovered losses faster than exports.

The trade deficit rose 17.7% to $ 678.7 billion last year, with exports of goods and services slipping nearly 16%. Imports fell by a total of 9.5%.

In December, the trade balance narrowed to $ 66.6 billion from $ 68.1 billion in November. However, this was still wider than the $ 65.7 billion. Consensus economists had expected by the end of last year.

9:31 ET: Stock opens higher, Dow wins more than 150 points

Here the markets traded shortly after the opening clock:

  • S&P 500 (^ GSPC): + 16.89 points (+ 0.44%) to 3,888.63

  • Dow (^ DJI): +176.23 (+ 0.57%) to 31.232.09

  • Nasdaq (^ IXIC): +38.42 (+ 0.28%) to 13.817.02

  • Raw (CL = F): + $ 0.85 (+ 1.51%) to $ 57.08 per. Barrel

  • Gold (GC = F): + $ 8.10 (+ 0.45%) to $ 1,799.30 per. Ounce

  • 10-year treasury (^ TNX): +1.1 bps to give 1.15%

8:45 AM: January wage gains disappoint

The US economy resumed adding more jobs than it lost in January, as easing residency restrictions and fiscal stimulus measures out of Washington eased some of the pressure on the labor market. However, the number of jobs recovered was less than expected.

Non-farm wages grew by 49,000 in January, coming in at less than half of the expected 105,000.

In addition, the depth of job losses in December was revised to be greater than previously reported. The economy threw 227,000 jobs in December against the previously reported 140,000.

While unemployment rose to 6.3% from 6.7%, the decline coincided with a decline in the labor force.

7:15 ET Friday: Futures expands earnings before January job report

Here the markets traded before the opening clock on Friday morning:

  • S&P 500 futures (ES = F): 3,882.75, up 18.25 points or 0.47%

  • Dow futures (YM = F): 31,091.00, up by 141 points or 0.46%

  • Nasdaq futures (NQ = F): 13,591.75, an increase of 44.25 points or 0.33%

  • Raw (CL = F): + $ 0.49 (+ 0.87%) to $ 56.72 a barrel

  • Gold (GC = F): + $ 10.20 (+ 0.57%) to $ 1,801.40 pr. Ounce

  • 10-year treasury (^ TNX): +1.2 bps to give 1.16%

18:03 ET Thursday: Stock futures open higher

Here the markets traded on Thursday night when trading at night started:

  • S&P 500 futures (ES = F): 3,864.75, up 0.25 points or 0.01%

  • Dow futures (YM = F): 30,955.00, up 5 points or 0.02%

  • Nasdaq futures (NQ = F): 13,555.5, up by 8 points or 0.06%

New York Stock Exchange (NYSE) on Wall Street on January 12, 2021 in New York City. US stocks on January 11, 2021 withdrew from records set last week when political uncertainty, including efforts to oust President Donald Trump from power, finally shook investors. (Photo by Angela Weiss / AFP) (Photo by ANGELA WEISS / AFP via Getty Images)

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

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