FINANCIAL MARKETS
NEW YORK—A broad-based push higher for stocks sent indexes to records on Thursday following yet more signs that the job market continues to improve. The Standard & Poor’s 500 index pierced the 2,420-point level for the first time during the morning and kept going. It ended at 2,430.06, up 18.26 points, or 0.8 percent. The Dow Jones industrial average gained 135.53, or 0.6 percent, to 21,144.18, and the Nasdaq composite rose 48.31, or 0.8 percent, to 6,246.83. All three indexes set record highs. Smaller stocks had even bigger gains, and the small-cap Russell 200 index jumped 25.85, or 1.9 percent, to 1,396.06, though it remains shy of its record.
Driving stocks higher was a report indicating that employers picked up their hiring last month. Payroll processor ADP said private businesses added 253,000 jobs in May, more than economists expected. It’s a reassurance, particularly when growth of the overall economy has remained frustratingly tepid. The U.S. government’s more comprehensive report on jobs arrives on Friday. It will include hiring by all non-farm employers, and economists expect it to show growth of 176,000 jobs in May. The data gave yet more encouragement to investors, many of whom were already looking to buy.
Other reports on the U.S. economy were mixed on Thursday. Manufacturing growth picked up last month and was stronger than economists were expecting, but construction spending unexpectedly weakened in April. A separate report showed that the number of workers filing for unemployment claims rose last week, which could be an indication that layoffs are on the rise. The number remains low by historical standards. The stock market’s gains were widespread, and all 11 sectors that make up the S&P 500 rose. Health care and financial stocks led the way. Producers of raw materials and companies that sell non-essentials to consumers were also particularly strong. The yield on the 10-year Treasury note held steady at 2.21 percent. A stronger job market gives the Federal Reserve more leeway to raise interest rates, and its next meeting on rate policy is in two weeks. The central bank has been gradually pulling rates off their record low following the Great Recession, and it has raised them twice since December. Benchmark U.S. crude oil rose 4 cents to settle at $48.36 per barrel. Brent crude, used to price international oils, fell 13 cents to settle at $50.63 a barrel. Natural gas fell 6 cents to settle at $3.01 per 1,000 cubic feet, heating oil slipped 2 cents to $1.50 per gallon and wholesale gasoline was close to flat at $1.60 per gallon.