(Reuters) - U.S. stocks rose on Friday with the S&P 500 and the Nasdaq Composite index hitting record highs as a smaller-than-expected rebound in the labor market last month highlighted the need for more government aid to shore up the economy.
Stimulus talks, upbeat earnings and progress in vaccine rollouts have bolstered bets of a speedy economic recovery, setting the S&P 500 and the Nasdaq on track for their biggest weekly percentage gains since the U.S. elections in early November.
The Labor Department’s data showed job losses in manufacturing and construction, the two sectors that have been propping up the economy. Job losses in December were also deeper than initially thought.
U.S. President Joe Biden’s drive to enact a $1.9 trillion coronavirus aid bill gained momentum on Friday with the U.S. House of Representatives set to vote on a budget plan that would allow the passage of the legislation in coming weeks without Republican support.
“The upcoming package of stimulus is going to be big,” said Alan Lancz, president of Alan B. Lancz & Associates Inc, an investment advisory firm based in Toledo.
“You have a situation where there’s a lot of cash on sidelines and bonds have really underperformed, so that’s helped some sectors that have really done poorly.”
The Dow Jones Industrial Average rose 85.2 points, or 0.27%, to 31,141.06, the S&P 500 gained 14.66 points, or 0.38%, to 3,886.4 and the Nasdaq Composite added 71.41 points, or 0.52%, at 13,849.15.
The S&P 500 technology sector slipped after hitting a record high earlier in the session.
Johnson & Johnson rose after the drugmaker said it had asked U.S. health regulators to authorize its single-dose COVID-19 vaccine for emergency use.
Shares of GameStop Corp, caught in the recent social media-hyped trading frenzy, was higher on Friday, after online broker Robinhood lifted all the buying curbs imposed at the height of the battle between amateur investors and Wall Street hedge funds.
So far, stronger-than-expected corporate results in the fourth quarter have driven up analysts’ expectations, and S&P 500 companies are on track to post earnings growth for the period instead of a decline as initially expected.
Advancing issues outnumbered declining ones on the NYSE by a 2.46-to-1 ratio; on Nasdaq, a 1.78-to-1 ratio favored advancers.
The S&P 500 posted 33 new 52-week highs and no new lows; the Nasdaq Composite recorded 267 new highs and four new lows.
(Reporting by Devik Jain and Medha Singh in Bengaluru; Editing by Maju Samuel and Richard Chang)
Source: Reuters