Stock Futures Jump on Jobs Data


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A monthly employment report that easily topped forecasts and showed the economy added more than 100,00 jobs last month sent futures soaring on Friday morning.

Today's Markets

As of 8:45 a.m. ET, Dow Jones Industrial Average futures jumped 107 points to 11,153, S&P 500 futures gained 12.3 points to 1,170 and Nasdaq 100 futures climbed 16 points to 2,221.

The economy added 103,000 jobs last month, blowing past consensus estimates of 60,000. The jobs gain wasn't enough, however, to put a dent in the 9.1% unemployment rate.  A large portion of the gain in payrolls in September came from the 45,000 Verizon workers who went on strike in August, and came back to work in September.

The private sector tacked on 137,000 jobs for the month while the government shed 34,000.  In what is seen as an encouraging sign, the labor force participation rate rose by 0.2 percentage points, meaning people are beginning to slowly move back into the labor force.  Additionally, average hourly earnings climbed 0.2%. There was also a large upward revision to the August reading, which initially showed no net job growth, but now comes in at a gain of 57,000.

The jobless rate first rose above 8% in February 2009 and has been stuck there ever since, peaking at 10.1% in October of that year.  The beleaguered labor market has been a considerable drag on the broader economy as consumers have lacked the confidence to make purchases, weighing on businesses' ability to expand.

Wall Street has rallied for three-straight days, with the blue chips zooming 468 points to the upside, and the S&P 500 leaping close to 6%. A combination of relatively encouraging economic data and easing tensions over Europe's twin sovereign debt and banking crises has led traders to pick up shares that were beaten down last quarter, the worst since the financial crisis in 2008.  The gains haven't been limited to equities: commodities have surged in recent sections, and Treasury yields have been rising from record lows.

Market participants have also been paying close attention to developments from Europe.  Moody's on Friday slashed the credit rating of Lloyds (NYSE:LYG) and the Royal Bank of Scotland (NYSE:RBS), two big British banks, in a sign of the growing concerns over the banking system on that side of the Atlantic.

German Chancellor Angela Merkel and French President Nicolas Sarkozy are set to meet on Sunday to discuss a European Union summit that takes place in two weeks.  The leaders of the currency bloc's two largest economies will likely discuss the bailout of Greece.  There has been a growing chasm between the German and French view on the bailout; Merkel has been under political pressure to reduce Germany's roll, while French banks have a particularly high exposure to Greek sovereign debt.

The euro gained 0.38% to $1.35, while the greenback fell 0.14% against a basket of world currencies.

Energy futures made a move higher.  Light, sweet crude rose $1.08, or 1.3%, to $83.66 a barrel.  Wholesale RBOB gasoline held steady at $2.69 a gallon.

Gold edged higher by $5.80, or 0.34%, to $1,659 a troy ounce.  The benchmark 10-year Treasury note yielded 1.995% from 1.988%.

Foreign Markets

The Euro Stoxx 50 rose 0.25% to 2,254, the English FTSE 100 gained 0.09% to 5,296 and the German DAX climbed 0.15% to 5,654.

In Asia, the Japanese Nikkei 225 jumped 0.98% to 8,606 and the Chinese Hang Seng slumped 0.26% to 2,581.