2/3/2012 4:27 PM ET
(RTTNews) - After turning in a lackluster performance in the previous session, stocks showed a substantial upward move during trading on Friday, as traders reacted positively to a much better than expected report on the employment situation in the month of January.
The major averages moved roughly sideways in afternoon trading, closing firmly in positive territory. The Dow jumped 156.82 points or 1.2 percent to 12,862.23, the Nasdaq soared 45.98 points or 1.6 percent to 2,905.66 and the S&P 500 surged up 19.36 points or 1.5 percent to 1,344.90.
For the week, the Dow rose by 1.6 percent, the Nasdaq shot up by 3.2 percent and the S&P 500 advanced by 2.2 percent. With the gains, the Dow ended the session at its best closing level in over three years, while the Nasdaq reached an eleven-year closing high.
The rally on Wall Street came following the release of a report from the Labor Department showing that stronger than expected job growth in the month of January drove the unemployment rate down to its lowest level in almost three years.
The Labor Department said non-farm payroll employment jumped by 243,000 jobs in January following a revised increase of 203,000 jobs in December. Economists had expected employment to increase by about 140,000 jobs.
With the stronger than expected job growth, the unemployment rate unexpectedly fell to 8.3 percent from 8.5 percent in the previous month. The drop pulled the unemployment rate down to its lowest level since a matching number in February of 2009.
Adding to the positive sentiment, the Institute for Supply Management released a report showing that its index of activity in the service sector jumped to an eleven-month high in January.
The ISM said its non-manufacturing index rose to 56.8 in January from a revised 53.0 in December, with a reading above 50 indicating growth in the service sector. Economists had expected the index to edge up to 53.3 from the 52.6 originally reported for the previous month.
With the bigger than expected increase, the index rose to its highest level since coming in at a reading of 59.0 in February of 2011.
Among individual stocks, shares of Tyson Foods (TSN) surged up by 4.1 percent after the meat processor reported better than expected first quarter earnings and said it expects its beef segment to be profitable in 2012.
Weyerhaeuser (WY) also turned in a strong performance after the lumber and real estate company reported much better than expected fourth quarter earnings.
Sector News
With optimism about the outlook for the economy generating broad based buying interest, most of the major sectors showed strong moves to the upside on the day.
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