MARKET SNAPSHOT Strong finish to a mixed week Investors cheer strong jobs report, set aside rate fears E-mail | Print | RSS Feed | Disable live quotes | Discuss By Mark Cotton, MarketWatch Last Update: 4:30 PM ET Mar 10, 2006
NEW YORK (MarketWatch) -- U.S. stocks ended higher Friday as a strong jobs report focused investors on the current strength of the economy, and helped them set aside interest-rate concerns that plagued the market for much of the week. The Dow Jones Industrial Average ($INDU : Dow Jones Industrial Average News , chart, profile, more Last: 11,076.34+104.06+0.95% 4:30pm 03/10/2006
$INDU11,076.34, +104.06, +0.9% ) was up 104.06 points at 11,076.34, the first triple-digit gain for the benchmark index in more than three weeks. The Dow posted a weekly gain of 0.5%. The Nasdaq Composite ($COMPQ : Nasdaq Composite Index News , chart, profile, more Last: 2,262.04+12.32+0.55% 5:16pm 03/10/2006
$COMPQ2,262.04, +12.32, +0.5% ) climbed 12.32 points to 2,262.04. On the week, the tech-rich index fell 1.8%. The S&P 500 Index ($SPX : S&P 500 Index News , chart, profile, more Last: 1,281.58+9.35+0.73% 4:59pm 03/10/2006
$SPX1,281.58, +9.35, +0.7% ) rose 9.35 points to 1,281.58. The broad gauge fell 0.4%. The Labor Department reported that U.S. nonfarm payrolls increased by a better-than-expected 243,000 last month. See full story. Average hourly earnings, a component closely monitored by the Federal Reserve in making decisions on interest-rate policy, increased by 5 cents in February to $16.47, up 0.3%. The unemployment rate ticked back to 4.8% from a five-year low of 4.7% in January. See full story. "It's a tug of war between earnings and interest rates," said Jim Awad, chairman of Awad Asset Management. "The job numbers were stronger than expected. Hourly earnings, while for the month were as expected, came in for the year at a level that might make the Fed uncomfortable," he added. "The case is here that we have a strong economy; we're creating jobs, wages are going up, That means for the time being corporate profits are in good shape." Awad also said the negative side of the jobs data is that it raises the risk that the Federal Reserve is going to have to raise rates over a longer than expected period, increasing the risk at some point down the road that they will begin to affect the economy negatively. "But for the moment, it looks like it's breaking on the side of the bulls. In other words, let's not worry about the future negative effect of interest rates, but let's enjoy the current strong economic growth we're experiencing and let's reflect that in stock prices," he commented. The Federal Open Market Committee, the Fed's interest-rate setting body, has raised its key short-term interest rate 14 times in a row to 4.5%. It next meets at the end of March, when it's widely expected to lift the rate by another quarter-percentage point. On the broader market for equities, advancers outpaced decliners by more than 2 to 1 on the New York Stock Exchange, and by 19 to 10 on the Nasdaq. See Market Summary. By sector, oil services ($OSX : phlx euro style oil svc index osx News , chart, profile, more Last: 190.59+1.24+0.65% 4:03pm 03/10/2006
$RLX466.01, +4.71, +1.0% ) , home builders (HGX : phlx hsg sector index News , chart, profile, more Last: 252.96+3.69+1.48% 4:04pm 03/10/2006
HGX252.96, +3.69, +1.5% ) and transportation stocks ($TRAN : Dow Jones Transportation Average News , chart, profile, more Last: 4,456.04+40.90+0.93% 4:30pm 03/10/2006
$TRAN4,456.04, +40.90, +0.9% ) were some of the biggest gainers. Semiconductors ($SOX : phlx semiconductor index sox News , chart, profile, more Last: 502.34-1.19-0.24% 4:01pm 03/10/2006
$SOX502.34, -1.19, -0.2% ) and retailers ($RLX : s&p retail index-rlx News , chart, profile, more Last: 466.01+4.71+1.02% 4:29pm 03/10/2006
$RLX466.01, +4.71, +1.0% ) came under pressure. Volume was 1.6 billion on the Big Board, and 1.77 billion on the Nasdaq. Also on the data front, U.S. wholesale inventories were as tight as ever in January, as sales growth of 1% outpaced inventory gains of 0.1%, the Commerce Department reported. Economists polled by MarketWatch had been expecting inventories to rise 0.6% in January. Tight inventories should lead to higher production later as wholesalers try to keep up with rising demand by increasing orders to producers and increasing imports, economists say. See full story. The U.S. federal deficit, meanwhile, reached a record $119 billion in February stoked by tax refunds and other outlays. For the fiscal year to date, the deficit narrowed to $218 billion compared to $223 billion this time last year. See full story. http://www.marketwatch.com/News/Story/Story.aspx?column=Market+Snapshot&siteid=mktw&dist=
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