Stocks rise as job growth stays strong through July
Banks and other stocks climbed Friday after the government reported more gains in hiring last month, the latest sign that the economy is continuing to hum along. The modest gains wrapped up another quiet week for the stock market.
Investors sold government bonds and bet that interest rates will rise. Technology companies rose. Weight Watchers soared after reporting a strong quarter. Viacom, the media company that owns Comedy Central and MTV, sank.
July was the second consecutive month of strong hiring, suggesting that the U.S. economy is still growing steadily as countries in Europe and less developed areas come out of long slumps.
“The economy is in pretty good shape,” said Paul Zemsky, chief investment officer for the multi-asset business of Voya Financial. “We’re seeing, for the first time, more of a globally synchronized growth.”
He said that will lead to a stronger global economy and will help American companies and stocks if growth in the U.S. falters.
Bond prices dropped, sending yields higher. The yield on the 10-year Treasury note climbed to 2.26% from 2.22% as investors concluded it is more likely the Federal Reserve will raise interest rates again this year.
Higher interest rates enable banks to make more money on loans. Bank of America shares climbed 2.5% to $24.98. KeyCorp ticked up 2.1% to $18.40.
Despite the gains Friday and the Dow Jones Industrial Average’s nine-day winning streak, most stocks have hardly moved over the last two weeks. The market barely reacted to news Thursday that special counsel Robert Mueller impaneled a grand jury as he continues to investigate Russia’s meddling in the U.S. presidential election.
Food delivery company Grubhub and online review site Yelp both jumped after Grubhub moved to expand its business by buying Yelp’s Eat24 unit. Yelp soared 27.7% to $40.05. Grubhub jumped 9.1% to $52.62.
GoPro leaped 19.2% to $9.85 after the maker of action video cameras posted sales that were much stronger than expected.
Weight Watchers International soared 25.1% to $41.39 after it blew past analysts’ expectations and raised its forecasts for the year. The company said it had 20% more subscribers at the end of June than it did a year earlier. Weight Watchers was worth less than $7 a share when Oprah Winfrey bought a 10% stake in 2015 and appeared in an ad for the company.
Viacom sank 13.8% to $30.22 after it reported trouble with a financing deal with a Chinese company and a drop in subscribers to its cable networks last quarter, as well as saying that in the current quarter, it expects a decline in the fees it receives from cable companies that carry its networks.
Among other cable network companies, Twenty-First Century Fox fell 1.3% to $28.46. Discovery Communications slid 4.1% to $23.73.
Benchmark U.S. crude rose 55 cents, or 1.1%, to $49.58 a barrel. Brent crude added 41 cents to $52.42 a barrel. Wholesale gasoline rose 1 cent to $1.65 a gallon. Heating oil gained 1 cent to $1.65 a gallon. Natural gas lost 3 cents to $2.77 per 1,000 cubic feet.
The dollar rose to 110.67 yen from 110.06 yen. The euro fell to $1.1769 from $1.1866.
Gold fell $9.80 to $1,264.60 an ounce. Silver dropped 38 cents, or 2.3%, to $16.25 an ounce. Copper rose 1 cent to $2.89 a pound.