NEW YORK (Reuters) - U.S. stocks rose in a broad-based rally on Friday as stronger-than-expected job growth in April coupled with muted wage gains left investors upbeat about the outlook for the economy and interest rates.
The Nasdaq registered a record high close, while the S&P 500 ended just shy of a record high finish.
The Labor Department said employers added 263,000 jobs in April, which blew past expectations, and the unemployment rate dropped to 3.6 percent, the lowest level since December 1969. Average hourly earnings came in just shy of expectations, indicating muted inflationary pressure.
The data supports the Federal Reserve’s patient stance toward raising interest rates, which is a positive for stocks.
“We continue to have stronger and stronger job growth, and it seems like there’s less and less inflation, which is really odd. You typically don’t see that, and basically what that signals to the market is that the Fed is on hold,” said Jamie Cox, managing partner of Harris Financial Group in Richmond, Virginia. “That could portend for better earnings in the future for companies.”
Boosting the S&P 500 and the Nasdaq, Amazon.com Inc rose 3.2%, after CNBC reported that Warren Buffett’s Berkshire Hathaway Inc has bought shares of the internet retailing giant for the first time.
The consumer discretionary sector rose 1.5%, leading a rally among the 11 major S&P sectors.
The Dow Jones Industrial Average rose 197.16 points, or 0.75%, to 26,504.95, the S&P 500 gained 28.12 points, or 0.96%, to 2,945.64, and the Nasdaq Composite added 127.22 points, or 1.58%, to 8,164.00.
For the week, the S&P 500 and Nasdaq were up 0.2% while
