S&P 500, Nasdaq set to wrap up best week since U.S. elections

By Medha Singh and Devik Jain (Reuters) - U.S. stocks rose on Friday with the S&P 500 and the Nasdaq hitting record highs as a smaller-than-expected rebound in the labor market last month highlighted the need for more government aid to shore up the economy.

Reuters February 06, 2021 00:07:02 IST
S&P 500, Nasdaq set to wrap up best week since U.S. elections

SP 500 Nasdaq set to wrap up best week since US elections

By Medha Singh and Devik Jain

(Reuters) - U.S. stocks rose on Friday with the S&P 500 and the Nasdaq hitting record highs as a smaller-than-expected rebound in the labor market last month highlighted the need for more government aid to shore up the economy.

Stimulus talks, upbeat earnings and progress in vaccine rollouts have bolstered bets of a speedy economic recovery, setting the S&P 500 and the Nasdaq on track for their best week since the U.S. elections in early November.

The Labor Department's data showed job losses in manufacturing and construction, the two sectors that have been propping up the economy. Job losses in December were also deeper than initially thought.

President Joe Biden's drive to enact a $1.9 trillion coronavirus aid bill gained momentum on Friday with the U.S. House of Representatives set to vote on a budget plan that would allow the passage of the legislation in coming weeks without Republican support.

"Today's payrolls number gives further momentum behind a large stimulus package ... on top of that you have equity earnings which continue to get revised up for the fourth quarter," said Jon Adams, senior investment strategist and portfolio manager at BMO Global Asset Management in Chicago.

Adams said the asset manager was "overweight" on equities, with a bias toward U.S. small-caps and emerging market stocks.

Economy-linked materials and energy led gains among major S&P sectors. The small-cap Russell 2000 index, sensitive to the domestic economic outlook, jumped 1%.

The tech sector slipped 0.4% after hitting a record high earlier in the session.

At 11:34 a.m. ET the Dow Jones Industrial Average rose 107.23 points, or 0.35%, to 31,164.21, the S&P 500 gained 13.55 points, or 0.35%, to 3,885.29 and the Nasdaq Composite gained 34.08 points, or 0.25%, to 13,812.88.

Johnson & Johnson rose 1.6% after the drugmaker said it had asked U.S. health regulators to authorize its single-dose COVID-19 vaccine for emergency use.

Shares of GameStop, caught in the recent social media-hyped trading frenzy, jumped about 30% again on Friday, after online broker Robinhood lifted all the buying curbs imposed at the height of the battle between amateur investors and Wall Street hedge funds.

Stronger-than-expected corporate results so far in the fourth quarter have driven up analysts' expectations, and S&P 500 companies are now on track to post earnings growth of 2.4% for the quarter instead of a decline as initially expected.

Activision Blizzard Inc jumped about 9.2% after the company forecast full-year adjusted revenue above analysts' estimates, driven by strong demand for the latest installment of its blockbuster "Call of Duty" franchise.

Chamath Palihapitiya-backed Clover Health Investments Corp said it had received a letter from the U.S. Securities and Exchange Commission following a critical report published by noted short-selling specialist Hindenburg Research.

Clover's shares dropped about 1.8%, extending losses from the previous session's 12% plunge.

Advancing issues outnumbered decliners by a 2.7-to-1 ratio on the NYSE and by a 1.8-to-1 ratio on the Nasdaq.

The S&P 500 posted 32 new 52-week highs and no new low, while the Nasdaq recorded 389 new highs and 16 new lows.

(Reporting by Devik Jain and Medha Singh in Bengaluru; Editing by Maju Samuel)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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