New York (CNN Business)The first jobs report of the Joe Biden presidency was less than OK — but Wall Street cheered anyway. Stocks rose Friday, extending all-time highs for the S&P 500 and Nasdaq.
The Dow gained more than 100 points, or 0.4%, in late morning trading. The government said that 49,000 jobs were added in January following a revised loss of 227,000 jobs in December. Economists had forecast a jobs gain of 50,000 for January.The unemployment rate fell to 6.3% from 6.7% a month earlier. But that’s still much higher than the 3.5% jobless rate a year ago before the Covid-19 pandemic sent the economy into recession.
Wages rose only modestly last month, which isn’t great news for American workers — but could be encouraging for investors. The slight wage gain suggests that inflation still isn’t a major economic threat, which likely means the Federal Reserve can hold interest rates near zero for a lot longer without having to worry that the economy will overheat.Read More
A week later, Robinhood removes trading restrictions on GameStop and AMCThe hopes for continued Fed stimulus, combined with expectations that consumer and business activity could soon resume to something closer to normal as more people receive coronavirus vaccines, has lifted the stock market for the past few months.Growth forecasts for the economy may now need to “be frantically revised upward” according to Brian Nick, chief investment strategist at Nuveen.Nick told CNN Business that current consensus forecasts of about 3.7% annualized gains for the gross domestic product in 2021 now “look absurdly low.” “The recovery is going to be fantastic unless there is some sort of catastrophic failure with the vaccine,” Nick added.Investors seem to agree with that bullish outlook.The Dow is up 4% this week and is on track for its best 5-day stretch since November. The S&P 500 and Nasdaq have gained about 4.5% and 5.5% this week respectively. Strong fourth quarter earnings have also helped boost investor sentiment. Ford (F), biotech company Gilead Sciences (GILD), social media firm Pinterest (PINS) and video game maker Activision Blizzard (ATVI) all rose following solid results. Big tech firms — the market’s beloved FAANG stocks as well as Microsoft and Tesla — have all posted healthy sales and profits as well. That’s led some experts to believe that growth stocks can continue to lead the market higher.
“Earnings have been good and the numbers from Apple and Microsoft have been stunning,” said Mark Stoeckle, CEO and senior portfolio manager of Adams Funds.Shares of GameStop (GME) and AMC (AMC) were up as well, although trading was volatile after Robinhood eased restrictions on buying those and other so-called meme stocks that have been boosted this year due to support from the Reddit WallStreetBets community.
Source: edition.cnn.com
