Government shutdown averted, as had been expected
U.S. stocks rose on Friday, with major indexes turning positive for the week after the November jobs report came in much stronger than expected, underlining the economy's strong fundamentals.
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The day's gains were broad, but technology shares were the biggest percentage gainers, providing an outsize lift to the Nasdaq.
What are indexes doing?
The Dow Jones Industrial Average rose 91 points, or 0.4%, to 24,301. The S&P 500 added 0.5% to 2,651, a gain of 0.5%. The Nasdaq Composite Index rose 41 points, or 0.6%, to 6,854.
The gain erased the weekly losses that all three had been poised for as of Thursday's close. Currently, the Dow is up 0.3% for the week while the S&P is up 0.3% and the Nasdaq is essentially unchanged. Both the Dow and the S&P are set for their third straight weekly advance.
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What's driving the markets?
The U.S. created 228,000 jobs in November, surpassing the 200,000 that had been expected, according to the nonfarm payroll report (http://www.marketwatch.com/story/us-gains-228000-new-jobs-in-november-in-another-strong-show-of-hiring-2017-12-08). The unemployment rate held at 4.1% while wages rose 0.2%. The report was the latest indication that the economy is running at full tilt, which could lead to the Fed being more aggressive in changing its monetary policy.
Investors on Friday also welcomed news that both the Senate and House late Thursday approved a two-week funding bill (http://www.marketwatch.com/story/house-passes-bill-to-avoid-government-shutdown-2017-12-07), staving off a threatened government shutdown this weekend. The bill now moves to President Donald Trump to sign, which he is expected to do on Friday. The bill buys Trump and congressional leaders a little more time to hammer out a longer-term deal.
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In Europe, investors cheered a breakthrough in Brexit talks (http://www.marketwatch.com/story/breakthrough-on-brexit-terms-opens-way-to-next-phase-of-talks-2017-12-08) between the U.K. and European Union. After days of tense negotiations, Jean-Claude Juncker, president of the European Commission, said early Friday that "sufficient progress" has been made for talks to move on to the second phase, which will cover trade agreements and a potential transition period.
European stocks rallied on the news, with the Stoxx Europe 600 index up 0.7% at 389.49. European markets were also propped up by a rally in bank stocks , which came after a long-awaited agreement on banking rules by global finance officials highlighted that most lenders hold a sufficient amount of capital.
The pound pound initially spiked (http://www.marketwatch.com/story/pound-rallies-to-6-month-high-against-euro-after-brexit-breakthrough-2017-12-08) to an intraday high of $1.3521, but has since slipped back to $1.3396.
What's coming up in economics?
Besides the jobs report, a reading on consumer sentiment fell to a three-month low in December (http://www.marketwatch.com/story/sour-on-tax-reform-us-consumer-sentiment-edges-down-to-three-month-low-2017-12-08), coming in below analyst expectations. Separately, wholesale inventories fell 0.5% in October (http://www.marketwatch.com/story/us-wholesale-inventories-slump-05-in-october-2017-12-08).
There were no Federal Reserve speakers slated to speak on Friday.
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What are strategists saying?
"I thought the jobs report was really good. It's hard to argue with anything on there, except the low level of wage growth gives us some pause," said J.J. Kinahan, chief market strategist at TD Ameritrade. "Wage growth is a conundrum, and that will make the Fed's upcoming statement really interesting. We have to see what they say about inflation because we're just not getting it."
Which stocks are in focus?
Large-capitalization technology stocks were among the biggest boosts to the overall market. Microsoft Corp. (MSFT) was up 2.1% while Google parent Alphabet Inc. (GOOGL) was up 0.7%.
Shares of American Outdoor Brands Corp.(AOBC) tumbled 14% after the gun maker late Thursday reported a drop in profit (http://www.marketwatch.com/story/gun-maker-american-outdoor-slashes-earnings-forecast-amid-challenging-market-conditions-2017-12-07) and forecast continued struggles amid "challenging market conditions."
United Natural Foods Inc.(UNFI) rose 1.9% a day after it reported stronger-than-expected sales (http://www.marketwatch.com/story/united-natural-foods-raises-guidance-shares-fall-2017-12-07) and raised its full-year forecasts.
Gilead Sciences Inc.(GILD) said late Thursday it will buy privately held cellular therapy company Cell Design Labs Inc. for $567 million (http://www.marketwatch.com/story/gilead-sciences-to-buy-cell-design-labs-for-567-million-2017-12-07). Gilead shares rose 2.2%.
Also in focus was United Continental Holdings Inc.(UAL). The airline operator said in Thursday's extended session it would buy back an additional $3 billion in shares (http://www.marketwatch.com/story/united-continental-to-buy-back-3-billion-more-in-shares-2017-12-07), lifting shares up 1.2%.
U.S.-listed stocks of European banks were also notably higher after an agreement on banking rules. Shares of Deutsche Bank AG(DBK.XE) rose 2.7%, Royal Bank of Scotland Group PLC(RBS.LN) added 1.9% and Barclays PLC(BCS) gained 1.9%.
What are other markets doing?
Asian stocks closed firmly in positive territory (http://www.marketwatch.com/story/samsung-helps-lift-kospi-as-asian-markets-gain-2017-12-07), with Japan's Nikkei 225 index staging a 1.4% rally.
Crude oil prices rose 0.7% to $57.10 a barrel, while gold prices dropped 0.4% to $1,247.80 an ounce.
Bitcoin slipped back below $15,000 (http://www.marketwatch.com/story/bitcoin-briefly-breaks-below-15000-on-coindesk-slides-11-2017-12-08), just hours after blasting through the $17,000 milestone.
(END) Dow Jones Newswires
December 08, 2017 14:02 ET (19:02 GMT)