NEW YORK The benchmark S&P 500 stock index traded above its record close on Friday as Wall Street rallied after a much-larger-than-expected print in jobs growth confirmed the U.S. economy has regained speed after a first-quarter lull.
The S&P traded less than four points away from the all-time intraday high of 2,134.72 reached in May 2015.
After a dismal payrolls report for May that raised concerns about the health of the economy, employers added 287,000 jobs in June, beating market expectations for the first time in four months.
“It’s good to see (the weak May number) was an anomaly, not a trend. That was the biggest worry coming into this, that last month’s weak number was starting a new normal in employment, and it didn’t," said J.J. Kinahan, chief strategist at TD Ameritrade in Chicago.
Some analysts said the strong jobs number could put an interest rate hike from the Federal Reserve back on the table, even as concerns linger over the global economic impact from Britain's vote last month to leave the European Union.
Financial stocks on the S&P 500, which would benefit from a rate hike, gained 1.9 percent. Wells Fargo and JPMorgan were among the biggest boosts to the broad index, while Goldman Sachs' 2.4 percent rise provided the biggest boost to the Dow.
The Dow Jones industrial average rose 247.41 points, or 1.38 percent, to 18,143.29, the S&P 500 gained 31.24 points, or 1.49 percent, to 2,129.14 and the Nasdaq Composite added 76.52 points, or 1.57 percent, to 4,953.33.
The S&P traded above 2,130.82, its record closing high.
All major S&P indexes were higher, led by gains in materials and industrials, which tend to outperform when the economy is see expanding.
The CBOE Volatility index, Wall Street's "fear gauge", which has swung wildly since the June 23 vote by Britons to leave the EU, was near its lowest for this year on Friday.
However some investors remained concerned about the effects of "Brexit" and ahead of the upcoming earnings season. Near record lows in 10- and 30-year U.S. government bond yields underscored those concerns.
"I am maintaining a cautious outlook for the next couple of months," said Phil Orlando, chief equity market strategist at Federated Investors in New York, citing Brexit, uncertainty about rate hikes and the November U.S. presidential election.
"I think investors are just whistling past the graveyard here; there is a lot of ugly stuff on the horizon that everyone is just sort of ignoring. It just strikes me there are just too many things that can go wrong over the next couple of months."
Advancing issues outnumbered declining ones on the NYSE by a 9.20-to-1 ratio; on Nasdaq, a 5.22-to-1 ratio favored advancers.
The S&P 500 posted 61 new 52-week highs and one new low; the Nasdaq Composite recorded 122 new highs and 12 new lows.
(Additional reporting by Chuck Mikolajczak; Editing by James Dalgleish)
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First Published On : Jul 9, 2016 01:30 IST