Stocks Up On Strong February Jobs Report

By: CNNMoney Staff
By: CNNMoney Staff

NEW YORK (CNNMoney) -- A better-than-expected jobs report had Wall Street in a good mood Friday morning.

The Dow and S&P 500 were higher, with the S&P 500 hitting a new all-time high yet again. The Nasdaq was in the red, as declines in biotech stocks weighed on the index. Biogen Idec and Vertex Pharmaceuticals were down more than 3% each. Biotech stocks have been one of the better performers this year but have recently begun to lose momentum.

Still, most investors were encouraged by the fact that the U.S. economy added 175,000 jobs last month, an improvement from January and ahead of economists' expectations. Meanwhile, the unemployment rate ticked up to 6.7%, from 6.6% the prior month as more Americans joined the labor force.

The pick-up in hiring is an encouraging sign given that economists and investors have been worried that weak job growth in December and January may be the start of a more sustained economic slowdown, said Jim Baird, chief investment officer at Plante Moran Financial Advisors.

The improvement also provides the Federal Reserve, which has begun scaling back, or tapering, its bond buying program by $10 billion a month, with more reasons to continue down its planned path, added Baird.

As investors made bets that the Fed will taper again at its meeting later this month, they dumped Treasuries, pushing the 10-year yield up to 2.8% from 2.73% late Thursday. Bond yields and prices move in opposite directions. And rates often go higher when economic data is improving.

Aside from the jobs report, investors are also keeping tabs on the latest earnings.

Shares of Foot Locker rose after the athletic apparel retailer reported stronger-than-expected results, including a 5.3% jump in same-store sales.

Shares of Big Lots climbed after the closeout retail chain slightly better quarterly revenue.

And shares in the supermarket chain Safeway fell following news that it will be bought by Albertsons, the supermarket chain controlled by private equity firm Cerberus.

Stocks are approaching the five-year anniversary of the starting point of the current bull market. While some investors worry that stocks are overdue for a pullback, bulls say there's more room to run.

Markets were rocky earlier in the week as a political and economic crisis in Ukraine intensified and Russia troops got involved. Tensions between Ukraine and Russia continue, though many investors feel that the worst may be over. International leaders have instituted some sanctions against Russia and offered help to Ukraine as they try to resolve the situation.

European markets were mixed in afternoon trading. Asian markets ended mixed. India's Sensex index rose by roughly 2%, while Japan's Nikkei closed with a gain of 0.9% and Hong Kong's Hang Seng index dropped 0.2%.

Posted by Greg Palmer


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