After moving notably higher over the course of the previous session, stocks are seeing further upside during trading on Friday. The Nasdaq has reached its best intraday level in well over a year, while the S&P 500 has set a new nine-month intraday high.
In recent trading, the Dow and S&P 500 have reached new highs for the session. The Dow is up 478.63 points or 1.5 percent at 33,540.20, the Nasdaq is up 119.38 points or 0.9 percent at 13,220.36 and the S&P 500 is up 48.53 points or 1.2 percent at 4,269.55.
The continued strength on Wall Street comes following the release of a closely watched Labor Department report showing U.S. employment surged by much more than expected in the month of May.
The report showed non-farm employment soared by 339,000 jobs in May after spiking by an upwardly revised 294,000 jobs in April.
Economists had expected employment to climb by 190,000 jobs compared to the jump of 253,000 jobs originally reported for the previous month.
Meanwhile, the Labor Department said the unemployment rate rose to 3.7 percent in May from 3.4 percent in April. The unemployment rate was expected to inch up to 3.5 percent.
“It’s hard to say which is the bigger surprise, the huge, unexpected rise in payrolls or the equally huge, unexpected rise in the unemployment rate,” said Chris Low, Chief Economist at FHN Financial.
“From the Fed’s perspective, the rise in unemployment coupled with the drop in average hourly earnings should outweigh the shock of another huge job gain,” he added. “After all, the weaker numbers stand in support of a pause they were leaning toward anyway.”
Positive sentiment has also been generated in reaction to news the Senate voted to pass the bill raising the U.S. debt ceiling late Thursday night.
The Senate voted 63 to 36 in favor of the debt ceiling bill, with 17 Republicans joining with the majority of Democrats to approve the legislation.
Following the House approval of the bill Wednesday night, the bill now heads to President Joe Biden, who is expected to sign the legislation later today.
“No one gets everything they want in a negotiation, but make no mistake: this bipartisan agreement is a big win for our economy and the American people,” Biden said in a statement following the Senate vote.
The passage of the bill eliminates the threat of a potentially disastrous default by the U.S. government, which had been hanging over the markets in recent weeks.
Steel stocks are turning in some of the market’s best performances on the day, resulting in a 4.9 percent spike by the NYSE Arca Steel Index. The index continues to regain ground after ending Wednesday’s trading at its lowest closing level in over six months.
Substantial strength is also visible among oil service stocks, as reflected by the 3.4 percent surge by the Philadelphia Oil Service Index.
The rally by oil service stocks comes amid a sharp increase by the price of crude oil, with crude for July delivery jumping $1.41 to $71.51 a barrel.
Banking stocks have also shown a strong move to the upside in morning trading, driving the KBW Bank Index up by 3.0 percent.
Chemical, brokerage and airline stocks are also seeing considerable strength on the day, moving higher along with most of the other major sectors.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Friday. Japan’s Nikkei 225 Index shot up by 1.2 percent, while Hong Kong’s Hang Seng Index soared by 4.0 percent.
The major European markets have also moved to the upside on the day. While the French CAC 40 Index has surged by 1.7 percent, the U.K.’s FTSE 100 Index is up by 1.4 percent and the German DAX Index is up by 1.0 percent.
In the bond market, treasuries are giving back ground after moving higher over the three previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 5.4 basis points at 3.662 percent.
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