Wall Street closes up sharply on surprise U.S. jobs report

By Stephen Culp

NEW YORK (Reuters) - Wall Street surged on Friday after a strikingly upbeat May jobs report unexpectedly provided the clearest evidence yet that the U.S. economy is headed for a quicker-than-anticipated recovery.

Related Articles

Manchester attacker's younger brother arrested in Tripoli - spokesman | Reuters

UK police arrest fifth person in connection with Manchester attack | Reuters

The Nasdaq breached its all-time closing high reached in February but pared its gains to end the session just below it. All three major U.S. stock indexes advanced two percent or more.

The S&P 500 and the Dow are both well within 10% of overtaking their record closing levels.

The U.S. economy added a remarkable 2.5 million jobs last month, rebounding from April's record 20.7 million drop and pushing the unemployment rate down to 13.3%. Analysts saw unemployment soaring to a historic 19.8%.

"The numbers are a huge surprise to the upside," said Michael Arone, chief investment strategist at State Street Global Advisors in Boston.

"It would suggest a further confirmation the economy is coming back online," Arone added. "This is a strong signal that the effects are temporary and that the economy is improving."

"Long may it last."

U.S. Treasury yields rose on the jobs data, giving a boost to interest rate-sensitive banks.

But the World Health Organization warned that the COVID-19 pandemic, which brought the global economy to its knees in the wake of mandated shutdowns, is far from over and new cases are on the rise.

Market participants now turn their focus to the U.S. Federal Reserve, which holds a monetary policy meeting next week where the latest jobs data will almost certainly be discussed.

Unofficially, the Dow Jones Industrial Average <.DJI> rose 829.16 points, or 3.15%, to 27,110.98, the S&P 500 <.SPX> gained 81.58 points, or 2.62%, to 3,193.93 and the Nasdaq Composite <.IXIC> added 198.27 points, or 2.06%, to 9,814.08.

All 11 major sectors of the S&P 500 ended the session well in the black, with cyclicals, which were beaten up amid economic lockdowns, leading the way.

Boeing Co provided the biggest boost to the blue-chip Dow on hopes of a pickup in air travel a day after American Airlines Group Inc and United Airlines said they would boost their U.S. flight schedule next month.

Shares of luxury retailer Tiffany & Co jumped after Reuters reported LVMH's $16.2-billion takeover deal was back on track.

Drugmaker Novavax Inc advanced following its announcement that the U.S. Department of Defense would give it up to $60 million to manufacture its COVID-19 vaccine candidate.

(Reporting by Stephen Culp; additional reporting by Herb Lash; Editing by Cynthia Osterman)

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