Wall Street made a muted advance yesterday after a better-than-expected employment report raised hopes about the economy's strength despite...
NEW YORK — Wall Street made a muted advance yesterday after a better-than-expected employment report raised hopes about the economy’s strength despite the recent hurricanes.
Despite the gains yesterday, the major indexes each lost more than 2 percent for the week.
At the close of trading, the Dow Jones industrial average gained 5.21 to 10,292.31 yesterday. Microsoft, one of the 30 Dow stocks, slipped 14 cents to close at $24.59 a share and ended the week down 4.4 percent. Boeing, also a Dow stock, fell 63 cents yesterday to $67.30, down 1 percent for the week.
Broader stock indicators were also higher yesterday. The Standard & Poor’s 500 index rose 4.41 to 1,195.90, and the Nasdaq composite index rose 6.27 to 2,090.35.
Most Read Stories
- The results are in: Here's where the new Dick's Drive-In will be
- Elon Musk’s SpaceX on brink of `Wright Brothers moment’ with reused rocket
- Best way to slow aging? Exercise, but not just any kind
- New residents pour in: Pierce, Snohomish counties see nation's biggest jump in movers
- Seahawks' QB Trevone Boykin arrested on suspicion of marijuana possession and public intoxication while passenger in car crash
For the week, the Dow ended down 2.6 percent, the S&P fell 2.7 percent, and the Nasdaq dropped 2.9 percent.
After three straight days of losses, the market came back yesterday after the Labor Department said September payrolls, while down for the first time in two years, fell by only 35,000 jobs. Fearing an economic slump in the wake of hurricanes Katrina and Rita, economists had forecast a drop of 150,000.
But while the Dow rose as much as 60 shortly after the opening bell, stocks gave up most of their gains throughout the day amid skepticism about the report. Investors awaited clarity about the economy’s health from upcoming third-quarter earnings and forward-looking estimates.
“Any celebration the market was going to put on was overshadowed by the fact that [the job loss] wasn’t good news,” said Arthur Hogan, chief market analyst at Jefferies. “I think calmer minds prevailed.”
The week ended complicated by inflation worries after Richard Fisher, president of Dallas Federal Reserve Bank, said inflation was approaching the high end of the Federal Reserve’s comfort zone — indicating the central bank’s rate tightening will continue.
Christopher Piros, director of investment strategy for Prudential’s Strategic Investment Research Group, was skeptical of the Labor Department data and said he’s waiting for October’s or November’s employment figures for a better read on the hurricanes’ effect.
“I think the immediate reaction ought to be that we have to wait and see,” Piros said. “Chances are, because the reference period was really before Rita hit and sort of in the midst of Katrina issues, many firms did not respond to the survey. People may have been treated as employed even though they were not in the area.”
The government also reported a moderate 0.2 percent increase in hourly wages last month, a signal that the economy is growing and not at risk of recession. The growth supports the Fed’s policy of increasing interest rates to contain inflation, and Piros downplayed concerns about soaring energy and material costs reaching consumers.
Meanwhile, a rise in oil prices broke a five-day slide as traders looked past news that U.S. fuel consumption declined last month amid expectations for increased demand this winter. A barrel of light crude added 48 cents to settle at $61.84 on the New York Mercantile Exchange.