The Dow Jones Industrial Average closed Friday's trading
session near 5 year highs as investors continue to pour money
into equities to start the year. Relatively good economic data
and healthy corporate earnings helped propel the major averages.
A surging euro currency is also giving investors confidence that
the worst is over for the debt-stricken continent whose problems
have weighed on U.S. markets in recent years.
The Dow Jones Industrial Average surged 149 points, or 1.08
percent, to 14,010.
The S&P 500 rose 15 points, or 1.01 percent, to 1,513.
The Nasdaq Composite led the major averages with a 37 point,
or 1.18 percent, gain on the session.
The markets were buoyed by a nonfarm payrolls report which
showed that the U.S. economy added more jobs than previously
estimated for the last two months of 2012. Although employment
figures for January came in below expectations, the November and
December numbers were revised upward by 86,000 and 41,000,
In January, payrolls rose by 157,000 after increasing by an
upwardly revised 196,000 in December. This was below consensus
estimates of 180,000 but investors were enthusiastic about the
revisions for November and December. Furthermore, the data showed
that for all of 2012 there were 335,000 more jobs added than had
been originally reported.
Private nonfarm payrolls rose by 166,00 jobs in January versus
an increase of 202,000 in December. This was also below
expectations of a 193,000 job gain for the month. The
unemployment rate ticked up from 7.8 percent to 7.9 percent in
January. Economists had projected that the unemployment rate
would fall to 7.7 percent.
University of Michigan Consumer Sentiment
The final reading for the University of Michigan Consumer
Sentiment index was revised higher to 73.8 versus a preliminary
reading of 71.3. This was ahead of consensus estimates calling
for an increase to 71.4. The figures show that a collapse in
December when the index fell from 82.7 in November to 72.9, was
likely not the beginning of a trend.
Investors were also heartened by a strong ISM Manufacturing
report. The index showed an expansion in manufacturing activity
in January, rising from 50.2 in December to 53.1. Economists had
projected that the reading would only increase slightly to
The December construction spending report showed improving
economic conditions in recent months. The index rose 0.9 percent
after increasing 0.1 percent in November. Private construction
spending jumped 2 percent in the month after recording a modest
0.2 percent gain in November.
Despite a strong move higher in stocks, WTI crude was only
slightly higher on the day. NYMEX crude contracts, the U.S.
benchmark, were up just 0.16 percent to $97.65 late in the day.
Brent contracts, however, had climbed almost 1 percent to
$116.60. Natural gas futures were last trading down 1.26 percent
COMEX gold futures had risen around 0.50 percent to $1,670
late on Friday. Silver contracts were last trading up almost 2
percent to just under $32 while copper futures were up almost
1.40 percent on the session.
Despite a risk on environment in the equity market, both corn
and wheat futures lost ground on the day. Corn was last down 0.61
percent while wheat futures had lost almost 2 percent. Soft
commodities were unchanged to moderately higher across the
The iShares Barclays 20+ Year Treasury Bond ETF (NYSE:
) recorded a sharp 1.30 percent loss on Friday and closed at
$115.54. The ETF actually opened the day higher, but fell
throughout the session as money came out of bonds and moved into
At the front-end of the curve, yields were unchanged with the
2-Year Note yield holding steady at 0.27 percent. The 5-Year
yield rose one basis point to 0.87 percent.
The 10-Year Note and 30-Year Bond yields rose four and six
basis points to 2.02 percent and 3.21 percent, respectively.
The U.S. dollar was slightly weaker on Friday. The PowerShares
DB US Dollar Index Bullish ETF (NYSE:
), which tracks the performance of the greenback versus a basket
of foreign currencies, lost 0.09 percent to $21.60.
The EUR/USD continued to surge, adding 0.59 percent to $1.3662
on the day. Conversely, the Yen continued to plunge versus the
greenback as the USD/JPY jumped 1.08 percent to 92.7400. The
other notable currency mover was the GBP/USD which had lost 0.86
percent at last check.
Volatility and Volume
The VIX plunged amid the big rally in stocks. The widely
watched volatility index lost around 9.50 percent to 12.92 and is
back near 52-week low levels as volatility expectations remain
Despite the bullish activity in the market, volume remained
light. Only around 109 million SPDR S&P 500 ETF (NYSE:
) shares traded hands compared to a 3-month daily average of over
Shares of Brightcove (
) fell more than 27 percent after the company's full-year and
first-quarter outlook failed to meet Wall Street
Anheuser-Busch InBev (NYSE:
) rose better than 4 percent a day after tehe stock fell due to a
Justice Department lawsuit seeking to block the company's
acquisition of Grupo Modelo.
Medical-device company Abaxis (NASDAQ:
) jumped more than 14 percent on stronger than expected
third-quarter earnings results.
) lost around 7 percent after the company's fourth-quarter
earnings missed analyst's expectations.
Carbo Ceramics (NYSE:
) surged almost 9 percent on the back of strong fiscal
Universal Display (NASDAQ:
) jumped over 10 percent on unconfirmed market chatter suggesting
a takeover of the company may be in the works.
GNC Holdings (NYSE:
) fell almost 7 percent on Friday after being downgraded by
analysts at William Blair.
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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