Stocks jump on reports of strong January job growth, service industry expansion - The Washington Post

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http://dealspl.us/special-offers/p_job-growth-seen-slower-in-january-not-great-news

NEW YORK — A drop in the unemployment rate to its lowest level in three years propelled stocks higher Friday. The Dow Jones industrial average jumped more than 140 points, drawing the average to its highest mark since before the financial crisis hit in 2008.

The Nasdaq index reached levels last seen in December 2000.

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( Richard Drew / Associated Press ) - Trader Warren Meyers, right, is illuminated by his handheld device as he works on the floor of the New York Stock Exchange Friday, Feb. 3, 2012. U.S. stocks are opening sharply higher after the unemployment rate dropped to the lowest in two years.
.Before the market opened, the Labor Department said companies hired 243,000 employees in January. That’s the strongest job growth in nine months. The increase in hiring pushed the unemployment rate down to 8.3 percent.

The surprising data gave stocks a morning jolt. The Dow shot up 161 points in early trading before drifting slightly lower.

“In this economy only one variable matters right now and that variable is employment,” said Lawrence Creatura, an equity portfolio manager at Federated Investors.

“This report was great news. It was beyond all expectations, literally. The number (243,000 hired in January) was higher than even the highest forecast.”

The Standard & Poor’s 500 index added 17 points to 1,342, as of 1:30 p.m. Eastern time. That’s a gain of 1.3 percent. The S&P 500 is on track to rise for the fifth straight week, the longest weekly winning streak since January of 2011. It’s up 6.8 percent so far this year.

More evidence that the economy is gaining strength followed the jobs report. A trade group said the service industry expanded at the fastest pace since last February. The government also said factory orders rose 1.1 percent in December, supported by a rebound in orders for heavy machinery.

In other trading, the Dow gained 143 points to 12,849, an increase of 1.1 percent. Bank of America Corp. led the Dow, rising 4.7 percent. Only three stocks were lower: Merck, Procter & Gamble and Pfizer.

The Nasdaq composite added 44 points, or 1.6 percent, to 2,904.

Treasury prices fell lifting the yield on the 10-year Treasury to 1.94 percent. When bond prices fall, yields rise. The benchmark 10-year rate had traded below 1.79 percent earlier this week as traders bought U.S. Treasurys on renewed concern over Europe’s ongoing debt crisis.

The U.S. jobs figures helped markets in Europe rally on Friday despite further evidence that the 17-country eurozone is heading for recession. Germany’s DAX closed 1.7 percent higher, and France’s CAC-40 gained 1.5 percent.

Among companies whose stocks are making large moves:

— Genworth Financial soared 12 percent, the best gain in the S&P 500. The insurance company reported late Thursday that it swung to a profit in the most recent quarter, helped by gains in sales of life insurance.

— Weyerhaeuser gained 5 percent after reporting better quarterly earnings than analysts’ forecasts. The timber and real estate company’s earnings still sank 62 percent.

— Video game maker Take-Two Interactive Software Inc. rose 3.5 percent. The company reported a 65 percent drop in quarterly profits after the market closed Thursday, but Wall Street’s analysts expected much worse.