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Stock Market News for February 06, 2017

President Donald Trump's recent steps to reduce regulations related to the financial sector and an encouraging jobs report led benchmarks to end in the green on Friday. Optimism over Trump's financial de-regulation actions boosted bank stocks, which in turn led the Dow to register its best gains for the year. Moreover, a record number of jobs were created last month, which also had a positive impact on investor sentiment.

For a look at the issues currently facing the markets, make sure to read today's Ahead of Wall Street article.

The Dow Jones Industrial Average (DJI) increased 0.9%, or 186.55 points, to close at 20,071.46. The S&P 500 rose 0.7% to close at 2,297.42. The tech-laden Nasdaq Composite Index closed at 5,666.77, gaining 0.5%. The fear-gauge CBOE Volatility Index (VIX) declined 8.1% to settle at 10.97. A total of around 6.45 billion shares were traded Friday, lower than the last 20-session average of 6.71 billion. Advancers significantly outpaced declining stocks on the NYSE. For 76% stocks that advanced, 21% declined.

Dow Register Best Gain in 2017

The Dow registered its best gain so far this year on the back of Trump's latest move to scale back financial regulations as well as strong job gains. Also, the blue-chip index rallied past the psychological level of 20,000 once again. Further, the tech-based Nasdaq closed at a new record high.

The President signed an executive order that directs the Secretary of the Treasury to assess the 2010 Dodd-Frank legislation. The order directs the Treasury Secretary to "consult with the heads of the member agencies of the Financial Stability Oversight Council" and "report to the President within 120 days" regarding any necessary legislative recommendations or regulatory changes.

The order also outlines the core principles of his administration regarding regulation of the financial system. If passed by Congress, it could lead to the replacement of the Dodd Frank law with a new set of rules.

Positive sentiment over Trump's latest steps on financial de-regulation led the Financial Select Sector SPDR (XLF) to rise 2%, which was the best performing sector among the S&P 500. Key component from this sector like Morgan Stanley ( MS ), Goldman Sachs Group, Inc. ( GS ) and JPMorgan Chase & Co. ( JPM ) increased 5.5%, 4.6% and 3.1%, respectively. While Morgan Stanley and JPMorgan possess a Zacks Rank #2 (Buy), Goldman Sachs hold a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

The U.S. added 227,000 jobs in January, higher than the consensus estimate of 174,000 job additions. This figure also exceeds December's reading of 157,000. Additionally, these are the best monthly job gains since September.

However, expectations that the economy is moving towards a full employment scenario weighed on workers pay, with average hourly wages rising only 0.1% in January, lower than December's downwardly revised gain of 0.2%. Further, the unemployment rate, meantime, ticked up to 4.8% from 4.7% in January.

In other economic news, the Institute for Supply Management reported that ISM Services Index fell to 56.5% in January. Meanwhile, factory orders rebounded in January by increasing 1.3% after decline in December.

Weekly Roundup

For the week, both the S&P 500 and Nasdaq advanced 0.1% while the Dow fell 0.1%. Upbeat earnings from Apple Inc. ( AAPL ) and Fed's positive view of the economy boosted two of the benchmarks. However, investors grappled over President Trump's order to tighten immigration rules during the week. Trump's approach on foreign trade and policies also dented investor sentiment, which in turn weighed on the Dow.

Stocks That Made Headlines

Newell Q4 Earnings In Line, Sales Lag; EPS View Up

Newell Brands Inc. ( NWL ) came up with fourth-quarter 2016 results, wherein adjusted earnings per share were in line with expectations while sales lagged estimates. ( Read More )

Statoil Discovers Gas Deposits in Valemon West Field

Statoil ASA ( STO ) recently announced that it has hit new gas deposits on the Valemon West field. ( Read More )

Visa Tops Q1 Earnings & Revenues, Reiterates FY17 View

Visa Inc. ( V ) posted first-quarter fiscal 2017 (ended Dec 31, 2016) earnings per share beating the Zacks Consensus Estimate. Also, the bottom line improved 7% year over year. ( Read More )

L Brands Reports Flat Comps in Q4, Sales Miss Estimates

L Brands, Inc. ( LB ) reported flat comparable sales for fourth-quarter fiscal 2016. ( Read More )

Verizon Acquires XO, Strengthens Dark Fiber Backhaul

Verizon Communications Inc. ( VZ ) recently completed the acquisition of privately held XO Communications Inc.'s dark fiber optic network. ( Read More )

Zacks' Top 10 Stocks for 2017

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Morgan Stanley (MS): Free Stock Analysis Report

Goldman Sachs Group, Inc. (The) (GS): Free Stock Analysis Report

J P Morgan Chase & Co (JPM): Free Stock Analysis Report

Apple Inc. (AAPL): Free Stock Analysis Report

Newell Brands Inc. (NWL): Free Stock Analysis Report

Statoil ASA (STO): Free Stock Analysis Report

Visa Inc. (V): Free Stock Analysis Report

L Brands, Inc. (LB): Free Stock Analysis Report

Verizon Communications Inc. (VZ): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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