Stocks close broadly higher after big job gains in March
Damian J. Troise and Alex Veiga
Wall Street stocks posted large gains on Monday as investors welcomed more signs that the economy is on the road to recovery,
The S&P 500 rose 1.4% to a record high after closing above 4,000 points for the first time last Thursday. The Dow Jones Industrial Average also hit a record high, with the market extending its recent streak of gains. Tech companies fueled much of the rally, which was a reaction to encouraging data on the economy.
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The US government announced last week that employers launched a hiring wave in March, creating 916,000 jobs, the highest number since August. Traders had a late reaction to the encouraging jobs report, which was released on Friday when trading closed. Investors were further encouraged by a report on Monday showing the service sector saw record growth in March as orders, hires and prices rose.
Employment and the service sector have lagged behind other sectors of the economy throughout the recovery. Analysts said both need to show signs of growth for the recovery to stay on track. COVID-19 and the potential for a spike in cases remain a concern, but the strong rollout of vaccinations makes a possible return to normal for many people seem clearer and closer.
“The jobs report highlighted the rebound in the labor market,” said Quincy Krosby, chief market strategist at Prudential Financial. “The only thing that can thwart this rebound, this recovery, will be for COVID-19 to launch another wave. “
The S&P 500 gained 58.04 points to 4,077.91 points. The benchmark index records two consecutive weekly gains. The Dow Jones gained 373.98 points, or 1.1%, to 33,527.19. The Nasdaq composite gained 225.49 points, or 1.7%, to 13,705.59.
Smaller company shares, which have been overtaking the broad market so far this year, also rose on Monday. The Russell 2000 Small Business Index added 10.98 points, or 0.5%, to 2,264.89. The index is up 14.7% so far this year, while the larger market S&P 500 index is up 8.6%.
The gains were widespread on Monday, with almost all sectors closing higher. Companies that are expected to benefit from a wider reopening of the economy and economic growth have also done well. Norwegian Cruise Line jumped 7.2% for the biggest gain of the S&P 500 as it seeks permission to resume cruises from U.S. ports in July with a vaccination requirement for passengers and members of the crew. Rival Carnival rose 4.7% and Royal Caribbean gained 2.9%.
Technology and communications stocks accounted for a large chunk of the gains on Monday. Apple grew 2.4%, Microsoft 2.8% and Facebook 3.4%. Tesla surprised investors with a report that vehicle deliveries doubled in the first quarter. Its shares jumped 4.4%.
Energy companies have fallen behind the broader market as crude oil prices have fallen, including a 4.6% drop in the price of US crude. Occidental Petroleum fell 7.6% and Marathon Oil fell 5.1%.
GameStop fell 2.4% after announcing a stock sale.
Yields on Treasury bills were mostly lower. The yield on the 10-year Treasury bill, which influences interest rates on mortgages and other consumer loans, slipped to 1.71% from 1.72% last week.