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Nov. 1, 2019, 4:21 p.m. EDT

S&P500 and Nasdaq hit new records after October jobs numbers beat expectations

U.S. manufacturing activity contracts, but at a milder pace, in October

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By Chris Matthews, MarketWatch , Andrea Riquier


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It’s jobs day.

Stocks ended sharply higher Friday, with the S&P 500 and Nasdaq Composite indexes surging to fresh records, and the Dow eyeing one of its own, after the Labor Department estimated the U.S. economy added 128,000 new jobs in October and upwardly revised its estimate of employment growth in September and August.

The stock market rally came despite indications the U.S. manufacturing sector was still contracting in October, though slightly less fast than in the previous month.

What are major indexes doing?

The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -0.14% rose 301.13 points, or 1.1%, to 27,347.36. The S&P 500 index /zigman2/quotes/210599714/realtime SPX -0.01% touched a fresh high after gaining 29.35 points, or 1%, to 3,066.91. The Nasdaq Composite index /zigman2/quotes/210598365/realtime COMP +0.0079% jumped 94.04 points, or 1.1%, at 8,386.40.

Read: Dow and S&P 500 are set to rise at least another 5% in the next 2 months — if this pattern holds

What’s driving the market?

The U.S. economy created 128,000 new jobs in October, above economist’s estimates of a 75,000 gain, while the unemployment rate ticked higher to 3.6%, in line with expectations. Furthermore, the government revised up the number of jobs created in August and September by a total of 95,000.

Wage growth rose by 0.2% in October and 3% from a year ago at a slightly lower pace than earlier in the year, but still faster than overall consumer prices.

“It’s hard not to be excited about this jobs report,” JJ Kinahan, chief market strategist at TD Ameritrade told MarketWatch. “There are tons of positives, including the uptick in jobs gains for previous months.

The numbers reflect momentum in the American, consumer-driven economy heading into the fourth quarter, Kinahan added. “Jobs have an amazing way of creating confidence in the economy.”

See: U.S. adds better-than-expected 128,000 jobs in October as economy holds strong

However, the latest survey-based take on the U.S. manufacturing sector was also in focus. The Institute for Supply Management’s October manufacturing activity index came in at 48.3% in October, below expectations for a 49% reading, but above the 47.8% seen in September. Any reading below 50% indicates contraction.

“The manufacturing sector weakness appears to be stabilizing after falling below the 50 level and into recession in August,” MUFG chief economist Chris Rupkey, said. “The outlook for the nation’s factories isn’t growing any worse and the manufacturing recession isn’t intensifying.”

See: U.S. manufacturers still suffering from China trade fight, tepid global economy, ISM finds

Spending on U.S. construction projects rose 0.5% in September, above economists’ expectations for a 0.3% rise, according to a MarketWatch poll and above the 0.3% decline in August

/zigman2/quotes/210598065/realtime
US : Dow Jones Global
27,975.70
-39.36 -0.14%
Volume: 52.23M
Dec. 9, 2019 11:16a
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/zigman2/quotes/210599714/realtime
US : S&P US
3,145.50
-0.41 -0.01%
Volume: 407.66M
Dec. 9, 2019 11:16a
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/zigman2/quotes/210598365/realtime
US : U.S.: Nasdaq
8,657.21
+0.68 +0.0079%
Volume: 710,819
Dec. 9, 2019 11:16a
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