U.S. stocks rose on Friday, with the Dow and S&P 500 on track for their seventh straight weekly advance after the November jobs report came in much stronger than anticipated, boosting banks and other sectors tied to the pace of growth.
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While crude oil continued its recent decline, weighing on energy shares, the gains were widespread, with market weakness concentrated in defensive sectors, which underperform in periods of economic expansion.
Payrolls rose by 321,000 in November, the largest number in nearly three years and way above the 230,000 estimated, while the unemployment rate held steady at 5.8 percent, a six-year low.
While the report blew past forecasts, it also raised expectations that a rate hike from the Federal Reserve may materialize sooner than previously thought.
Financials led the day's gains, up 1.2 percent as higher interest rates would prop up earnings in the sector. Bank of America (BAC) rose 2.8 percent to $17.70 while Goldman Sachs (GS) was up 2.4 percent to $196.50, boosting the Dow.
Utilities, a dividend play, fell 1.1 percent as Treasuries yields rose. Energy fell 0.5 percent alongside a 1.1 percent drop in crude prices.
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"This report solidifies the idea that the economy is getting stronger, and the more economic activity on Main Street, the better it will be for financials," said Adam Sarhan, chief executive of Sarhan Capital in New York.
"The economy doing well is win-win-win across the board for financials, because it means more lending, more economic activity, and with markets at highs, brokers are getting more in commission and this and that. Financials are poised to move much higher."
Not everything was rosy, however, as new orders for U.S. factory goods fell for a third straight month in October, pointing to a slowdown in manufacturing activity.
At 12:54 p.m. (1754 GMT) the Dow Jones industrial average rose 79.31 points, or 0.44 percent, to 17,979.41, the S&P 500 gained 6.47 points, or 0.31 percent, to 2,078.39 and the Nasdaq Composite added 17.08 points, or 0.36 percent, to 4,786.52.
The Dow hit a record high and, alongside the S&P 500, was on track for a seventh week of gains, a streak not seen in a year for both. The Nasdaq Composite is slightly lower so far this week.
American Eagle Outfitters (AEO) fell 14 percent to $11.82 after the teen apparel retailer forecast a current-quarter profit below analysts' estimates and reported its fifth straight drop in quarterly income.
Advancing issues outnumbered decliners on the NYSE by 1,738 to 1,300, for a 1.34-to-1 ratio; on the Nasdaq, 1,831 issues rose and 832 fell, for a 2.20-to-1 ratio.
The S&P 500 was posting 91 new 52-week highs and 10 new lows; the Nasdaq Composite was recording 155 new highs and 77 new lows.