The Morning Journal (Lorain, OH)
Late push takes stocks to new records
A solid pickup in hiring last month helped push the stock market to record highs.
A solid pickup in hiring last month helped push the stock market to record highs Friday. The gains were driven by energy, technology and industrial companies.
The Labor Department told investors what they had hoped to hear: employers added more workers last month after a sluggish beginning to the year.
Energy companies rose as the price of oil recovered from losses earlier in the week. Media companies like CBS and Charter Communications recovered from their losses earlier in the week. Technology companies rose, but IBM missed out after billionaire investor Warren Buffett said he sold a large part of his stake in the company.
After a quiet morning, stocks rose in the afternoon and the S&P 500 finished above the all-time high close it set March 1.
Scott Wren, senior global equity strategist at Wells Fargo’s Investment Institute, said stocks benefited from the combination of greater hiring and slower wage growth because if wages rise too quickly it will affect corporate profits.
“The market is likely to be concerned about wage gains and the impact on corporate margins as we move into 2018,” he said.
The Standard & Poor’s 500 index climbed 9.77 points, or 0.4 percent, to 2,399.29. The Dow Jones industrial average rose 55.47 points, or 0.3 percent, to 21,006.94.
The Nasdaq composite jumped 25.42 points, or 0.4 percent, to 6,100.76, which beat a record it set earlier this week. The Russell 2000 index of smaller-company stocks added 8.15 points, or 0.6 percent, to 1,397.
Employers in the United States added 211,000 jobs in April, according to the Labor Department. That comes after slow hiring over the first three months of the year and sluggish economic growth.
Energy companies bounced back as the price of oil steadied. After two steep losses in three days, benchmark U.S. crude oil jumped 70 cents, or 1.5 percent, to $46.22 a barrel in New York. Brent crude, the standard for international oil prices, added 72 cents, or 1.5 percent, to $49.10 barrel in London. Oil prices had fallen earlier this week as investors wonder if OPEC will extend a deal that trimmed oil production.
Occidental Petroleum rose $2.38, or 4.1 percent, to $60.40 and Transocean jumped 84 cents, or 8.1 percent, to $11.18. Baker Hughes gained $1.92, or 3.3 percent, to $59.33.
Apple jumped $2.43, or 1.7 percent, to $148.96, another record for the world’s most valuable publiclytraded company. That helped tech stocks move higher.
Basic materials makers advanced. Dow Chemical gained $1.67, or 2.7 percent, to $63.09 and gas supplier Praxair rose $3.16, or 2.5 percent, to $129.48. Fertilizer maker CF Industries climbed $1.35, or 5 percent, to $28.42.
CBS announced a bigger profit and more revenue than analysts expected, and its stock gained $1.35, or 2.1 percent, to $65.20. Media companies have struggled the last few days as investors worried about declining cable ad revenue. Charter Communications, Scripps Networks and Tegna all traded higher.
IBM fell after Warren Buffett said he’s sold about 25 million shares of the technology and consulting company, about a third of the stake that his Berkshire Hathaway company had owned. Buffett started buying IBM stock in 2011. IBM faces stiff competition from companies including Microsoft and Amazon, which have focused on cloud computing services. IBM reached an all-time high of $215 in early 2013 and closed at $155.05 Friday, down $4, or 2.5 percent.
Cosmetics maker Revlon plunged after its sales in North America fell during the first quarter. That affected all parts of its business, as its consumer and professional divisions both reported smaller profits and lower sales than they did a year ago. Revlon bought Elizabeth Arden in September, and sales for that business were about the same as they had been a year ago. The stock had its worst day since 2008 as it gave up $5.95, or 23.6 percent, to $19.30.