Stocks Mount Rise on Above-Average Payrolls Gains
NEW YORK (TheStreet) -- Stocks were gaining Friday after above-average gains in the May government jobs report and after the European Central Bank's unprecedented move on interest rates on Thursday.
Nonfarm payrolls increased by 217,000 in May vs. the average estimate of 218,000 gleaned from a Reuters survey of economists. That's also weaker than April's figure, which was a downwardly revised 282,000. Still, the May number was slightly higher than the average gain of 197,000 over the past year and is more evidence that the economy is on the right track.
The jobless rate was unchanged at 6.3% vs. the consensus 6.4%.
While the report will likely keep the stimulus tapering process by the Federal Reserve on track, it's unlikely to alter by much the Fed's timeline for potential policy rate hikes starting mid-2015, according to Barclays economists.The S&P 500 was up 0.41% to 1,948.47 and the Dow Jones Industrial Average was increasing 0.41% to 16,905.95. The Nasdaq was advancing 0.55% to 4,319.75. U.S. stocks on Thursday rose to record highs as markets cheered the ECB's moves to help stimulate the eurozone economy. European markets were higher after the ECB's decision Thursday and the U.S. labor market data. The FTSE was up by 0.47% and the DAX was adding on 0.41%. In Asia, the Nikkei 225 finished flat and the Hang Seng closed down 0.69% before investors were able to get a glimpse of the nonfarm payrolls report. Stocks to watch Friday include Bank of America (BAC), General Motors (GM), Walmart (WMT) and Gap (GPS). Gap was rising 2% after the retailer posted a 1% increase in May same-store sales, which was better than the 0.2% Wall Street target. Walmart, the world's largest retailer, is holding its annual shareholders' meeting on Friday. Shares were effectively flat at $77.33.
General Motors shares were gaining 1% a day after CEO Mary Barra's pledge that the automaker never will again repeat the mistakes surrounding its ignition switch problems, which led to at least 13 deaths, 47 crashes, the recall of 2.6 million cars and then to a worldwide recall of 15.8 million cars with more to come.
Bank of America is in talks to pay at least $12 billion to settle civil probes by the Justice Department and a number of states into the bank's alleged handling of shoddy mortgages, The Wall Street Journal reported, citing people familiar with the negotiations. Shares added 1% on Friday. -- By Andrea Tse and Joe Deaux in New York
>> Read More: June 6 Premarket Briefing: 10 Things You Should Know European Stocks Up Following ECB Moves, Ahead of U.S. Jobs Report
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