Better-than-expected non-farm payroll numbers overshadowed
investor concerns about the Fed tapering its bond buying program,
lifting benchmarks higher on Friday. Major indices finished in
the green in a holiday-shortened week. Aluminum giant Alcoa will
officially kick off the second quarter earnings season on Monday
after the market closes. In the later part of the week, major
companies from the banking sector are expected to report their
quarterly results. The financial sector was the biggest gainer
among the S&P 500 industry groups. Utilities stocks were the
For a look at the issues facing today's markets, read our
Ahead of Wall Street for July 8
The Dow Jones Industrial Average (DJI) gained 1.0% to close
the day at 15,135.84. The S&P 500 added 1.0% to finish
Friday's trading session at 1,631.89. The tech-laden Nasdaq
Composite Index rose 1.0% to end at 3,479.38. The fear-gauge CBOE
Volatility Index (VIX) tumbled 8.1% to settle at 14.89.
Consolidated volumes on the New York Stock Exchange, American
Stock Exchange and Nasdaq were roughly 4.9 billion shares,
significantly lower than 2013's average of 6.4 billion shares.
Advancing stocks outnumbered the decliners. For the 53% that
advanced, 45% declined.
The Dow Jones gained 1.5%, the S&P 500 rose 1.6% and the
Nasdaq added 2.2%, over the last week. The previous week's gains
were primarily driven by encouraging domestic reports. When the
government reported healthy numbers on the job market, investors
were confused as to how to react to this report. Benchmarks
opened higher but declined as the day progressed.
Better-than-expected non-farm payrolls numbers increased investor
concerns about the Fed slowing its bond buying program. But
markets recovered after investors ultimately accepted that the
report was a positive indication for the economy. The S&P 500
posed its best weekly performance in the last three weeks.
According to the U.S Department of Labor, the U.S economy
added 195,000 jobs in the month of June. This was considerably
higher than the consensus estimate of 162,000. Increase in
employment in the previous month was primarily boosted by strong
hiring from leisure and hospitality, professional and business
services, retail trade, health care, and financial activities.
Leisure and hospitality added 75,000 jobs whereas employment in
professional and business services increased by 53,000. Retail,
health care and financial activities added 37,000, 20,000 and
17,000 jobs respectively. But the unemployment rate remained
unchanged at 7.6%. This was marginally higher than the
consensus estimate of 7.5%.
Encouraging reports from the private and the government sector
on the job markets is indicative of a healthy job market. In the
previous week, a report from the ADP Research Institute revealed
that a total of 188,000 people were added to the private sector
in the month of June. Improvement in the job market is boosted by
consumer spending and the recovery in the housing sector.
Consumer confidence touched its highest level in more than 5
On the earnings front, Alcoa Inc. (NYSE:
) is scheduled to report its quarterly results after the close of
markets on Monday. Banking giants JPMorgan Chase & Co. (NYSE:
) and Wells Fargo & Co (NYSE:
) are due to report quarterly results on Friday. Investor
attention will turn to the earnings season from this
The financial sector was the biggest gainer among the S&P
500 industry groups and the Financial Select Sector SPDR (XLF)
gained 1.8%. Stocks such as JPMorgan Chase & Co. (NYSE:
), Wells Fargo & Co (NYSE:
), Bank of America Corp (NYSE:
), Citigroup Inc. (NYSE:
) and Goldman Sachs Group Inc (NYSE:
) added 2.3%, 2.1%, 1.8%, 1.8% and 1.9%, respectively.
The utilities sector was the only loser among the S&P 500
industry groups and the Utilities SPDR (XLU) lost 0.5%. Stocks
such as Public Service Enterprise Group Inc. (NYSE:
), NRG Energy Inc (NYSE:
), Exelon Corporation (NYSE:
), Duke Energy Corp (NYSE:
) and Wisconsin Energy Corporation (NYSE:
) declined 0.4%, 0.5%, 1.1%, 0.2% and 0.1%, respectively.
ALCOA INC (AA): Free Stock Analysis Report
BANK OF AMER CP (BAC): Free Stock Analysis
CITIGROUP INC (C): Free Stock Analysis Report
DUKE ENERGY CP (DUK): Free Stock Analysis
EXELON CORP (EXC): Free Stock Analysis Report
GOLDMAN SACHS (GS): Free Stock Analysis
JPMORGAN CHASE (JPM): Free Stock Analysis
NRG ENERGY INC (NRG): Free Stock Analysis
PUBLIC SV ENTRP (PEG): Free Stock Analysis
WISC ENERGY CP (WEC): Free Stock Analysis
WELLS FARGO-NEW (WFC): Free Stock Analysis
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