Strong hir­ing lifts stock in­dexes

Northwest Arkansas Democrat-Gazette - - BUSINESS & FARM - MAR­KET RE­PORT MAR­LEY JAY

NEW YORK — Banks and other stocks climbed Fri­day af­ter the gov­ern­ment re­ported more gains in hir­ing last month, the lat­est sig­nal that the econ­omy is continuing to hum along. The mod­est gains wrapped up an­other quiet week for the stock mar­ket.

The Depart­ment of Labor said U.S. em­ploy­ers added 209,000 jobs last month. In­vestors sold gov­ern­ment bonds and bet that in­ter­est rates are go­ing to rise, which lets banks make more money on loans. Tech­nol­ogy com­pa­nies also rose. Weight Watch­ers soared af­ter re­port­ing a strong quar­ter while 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 coun­tries come out of long slumps.

“The econ­omy is in pretty good shape,” said Paul Zem­sky, chief in­vest­ment of­fi­cer for the mul­ti­as­set busi­ness of Voya In­vest­ment Strate­gies. “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.

The Stan­dard & Poor’s 500 in­dex rose 4.67 points, or 0.2 per­cent, to 2,476.83. The Dow Jones in­dus­trial av­er­age rose 66.71 points, or 0.3 per­cent, to 22,092.81. That was its ninth gain in a row. The Nas­daq com­pos­ite climbed 11.22 points, or 0.2 per­cent, to 6,351.56. The Rus­sell 2000 in­dex of smaller com­pa­nies rose 7.09 points, or 0.5 per­cent, to 1,412.32.

Euro­pean stock in­dexes made even larger gains. France’s CAC 40 in­dex climbed 1.4 per­cent, and the DAX in Ger­many jumped 1.2 per­cent. The British FTSE 100 gained 0.5 per­cent.

Bond prices dropped, send­ing yields higher. The yield on the 10-year Trea­sury note climbed to 2.26 per­cent from 2.22 per­cent as in­vestors con­cluded it is more likely the Fed­eral Re­serve will raise in­ter­est rates again later in the year.

Bank of Amer­ica climbed 60 cents, or 2.5 per­cent, to $24.98, and KeyCorp rose 37 cents, or 2.1 per­cent, to $18.40.

De­spite the gains Fri­day and the Dow’s long win­ning streak, most stocks have hardly moved over the past two weeks. The mar­ket barely re­acted to news Thurs­day that spe­cial coun­sel Robert Mueller im­pan­eled a grand jury as he con­tin­ues to in­ves­ti­gate pos­si­ble Rus­sian med­dling in the pres­i­den­tial elec­tion.

In­vestors have con­sis­tently ig­nored sur­pris­ing or un­usual news out of Wash­ing­ton, and Pres­i­dent Don­ald Trump’s tweets don’t af­fect stocks the way they did six months ago ei­ther.

Zem­sky of Voya In­vest­ment Strate­gies said that with the econ­omy and cor­po­rate earn­ings do­ing well, in­vestors will stay the course un­less some­thing much more dra­matic hap­pens.

“Sell­ing stocks on a tweet or a news head­line when the fun­da­men­tals are good is go­ing to ul­ti­mately lead to losses,” he said.

Weight Watch­ers In­ter­na­tional raised its fore­casts for the year af­ter it blew past an­a­lysts’ ex­pec­ta­tions. The com­pany said it had 20 per­cent more sub­scribers at the end of June than it did a year ear­lier. Its stock rose $8.31, or 25.1 per­cent, to $41.39.

Weight Watch­ers was worth un­der $7 a share when Oprah Win­frey bought a 10 per­cent stake in it in 2015 and ap­peared in an ad for the com­pany. It traded above $80 in early 2012.

Vi­a­com tum­bled af­ter the com­pany re­ported trou­ble with a fi­nanc­ing deal with a Chi­nese com­pany. The com­pany said it didn’t re­ceive a pay­ment in June from Huahua Me­dia, which agreed to help fi­nance Para­mount Pic­tures films as part of a deal that was struck in Jan­uary. The stock sank $4.85, or 13.8 per­cent, to $30.22.

Vi­a­com also said its sub­scribers to its ca­ble chan­nels dipped in the third quar­ter, and in the cur­rent quar­ter it ex­pects a de­cline in the fees it re­ceives from ca­ble com­pa­nies who carry its chan­nels.

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