Stocks rallied Friday following the May employment report, which surpassed expectations.
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The Dow Jones Industrial Average rose 219.37 points, or 0.9%, to 24,635.21. The S&P 500 climbed 29.35 points, more than 1%, to 2,734.62. The Nasdaq Composite was up 112.21 points, or 1.51%, at 7,554.33.
The U.S. economy added 223,000 workers in May, surpassing the 188,000 analysts polled by Thomson Reuters were expecting. The unemployment rate fell to 3.8%, an 18-year low and down from April’s 3.9%. Wage inflation inched higher to 0.3%.
Treasury yields climbed following the report on the expectation that it would support an impending Fed rate hike. Financial stocks, including Bank of America, Goldman Sachs, Wells Fargo, Citigroup and JPMorgan Chase, ascended Friday.
|BAC||BANK OF AMERICA CORP.||27.01||-1.17||-4.15%|
|GS||GOLDMAN SACHS GROUP INC.||188.96||-5.62||-2.89%|
|JPM||JP MORGAN CHASE & CO.||99.76||-3.11||-3.02%|
|WFC||WELLS FARGO & COMPANY||48.31||-1.55||-3.11%|
Ameriprise Senior Economist Russell Price said the May jobs report offered a positive view of U.S. job market conditions, “without being overly strong as to create significant inflation concerns.”
“There should be little doubt, however, that labor cost pressures are building, and we are very likely to see further acceleration of wage growth in the months and quarters ahead,” Price wrote in a note to clients.
Tech stocks also rallied Friday, with Apple, Microsoft, Amazon and Netflix all hitting all-time highs. In intraday trade, Microsoft even topped $100 per share.
U.S. equities also received support from political developments in Italy, where officials agreed on forming a coalition government. Concerns over a potential repeat election in Italy roiled the market earlier this week.
Other economic data released Friday morning included readings on the manufacturing and construction sectors. May construction activity increased by 1.8% and the Institute of Supply Management’s May manufacturing index came in at 58.7, above the 58.1 analysts were expecting. Any reading above 50 indicates expansion.
In commodities, U.S. oil futures dropped $1.23, or 1.8%, to $65.81 a barrel.
Baker Hughes reported Friday afternoon that the number of active U.S. rigs drilling for oil increased by two to 861 this week, following last week’s increase of 15.
Gold closed lower, shedding 0.4% to finish at $1,299.30 an ounce.
FOX Business’ Ken Martin contributed to this article.