IE 11 is not supported. For an optimal experience visit our site on another browser.

Wall Street jumps after jobs surge

/ Source: The Associated Press

Pleased with a better-than-expected jobs report for the month of March, investors sent stocks sharply higher on Wall Street Friday, setting aside worries on the potential for higher interest rates to focus on the 308,000 jobs created last month.

The day capped Wall Street’s best week so far this year, with the Dow posting its best weekly performance since April 28, 2003, and the Nasdaq seeing its strongest weekly gain since May 13, 2002.

The Labor Department employment report also included upward revisions in the January and February figures. For the quarter, the economy added a total of 513,000 jobs.

“You certainly can’t call this a jobless recovery any more,” said Joseph Battipaglia, chief investment officer at Ryan Beck & Co.

The unemployment rate, however, rose to 5.7 percent in March from 5.6 percent in February as more people came back into the job market. That could help ease the concerns of some investors that the Federal Reserve may speed up its timetable for raising rates.

The Dow Jones industrial average rose 97.26 points, or 0.9 percent, to close the day at 10,470.59.

Broader stock indicators were also up sharply. The Standard & Poor’s 500-stock index rose 9.64 points, or 0.9 percent, to 1,141.81, while the Nasdaq composite index added 42.16 points, or 2.1 percent, to close at 2,057.17.

For the week, the Dow rose 2.5 percent, the Nasdaq climbed 5 percent and the S&P 500 was up 3 percent. All three indices moved into positive territory for the year.

Investors will likely look forward to earnings season with more confidence, but the specter of interest rate hikes will keep any rise in the markets relatively tame, Battipaglia said, at least compared with the stunning growth experienced in 2003.

“Now, you’ll see people turn their attention to interest rate worries and perhaps being somewhat cautious about the market,” Battipaglia said. “That’s a healthy process for the market.”

Still, most analysts believe that interest rate hikes are months away.

“Once the Fed starts tightening rates, either late this year or early next year, the increases could come pretty rapidly, in rapid succession,” said Stuart Schweitzer, global markets strategist at JP Morgan Fleming Asset Management. “But for now, I think the good news we got today is just that — good news.”

While the economy adds jobs, struggling computer and software maker Sun Microsystems Inc. is cutting them. The company, which said it would miss its own earnings estimates for the first quarter, plans to cut 3,300 jobs.

However, the company also settled a long-standing court battle with bitter rival Microsoft Corp. by signing a 10-year, $1.6 billion cooperative agreement. Sun gained 87 cents, or 21 percent, to $5.06 as the two companies said they will work to ensure that Sun’s technology will be compatible with Microsoft’s.

Another troubled computer maker, Gateway Inc., climbed 66 cents to $6.06 a day after it announced it is cutting 2,500 jobs and closing its 188 retail stores around the country.

Semiconductor stocks helped advance the technology sector as the industry reported a 31 percent spike in worldwide sales for February. Intel Corp. rose 74 cents to $28.12, while rival Advanced Micro Devices Inc. gained 66 cents to $17.45.

There was yet another merger in the banking industry, though certainly not on the scale of Bank of America’s acquisition of FleetBoston, which closed Thursday.

There was yet another merger in the banking industry, though certainly not on the scale of Bank of America’s acquisition of FleetBoston, which closed Thursday.

Western New York bank First Niagara Financial Group Inc. announced it would buy Hudson River Bancorp Inc. for $19.60 per share. Hudson River dropped $1.52 to $19.03, while First Niagara fell 37 cents to $13.50.

Advancing issues outnumbered decliners by a 4-to-3 ratio on the New York Stock Exchange. Consolidated volume came to 2.07 billion shares, compared with 1.97 billion on Thursday.

The Russell 2000 index of smaller companies was up 8.13 points, or 1.4 percent, at 603.45 by the close.

Overseas, Japan’s Nikkei stock average rose 1.1 percent. Britain’s FTSE 100 gained 1.2 percent for the session, France’s CAC-40 closed up 1.9 percent and Germany’s DAX index jumped 2.1 percent.