The DJIA resolved higher, as post-payrolls rate-hike hopes lifted financial stocks
It was another wishy-washy session for the Dow Jones Industrial Average (DJIA), as traders weighed a surge in October payrolls and a seven-year low in the unemployment rate. On one hand, the blowout jobs report signaled a healthy economy; on the other, it also signaled a rate hike on the horizon before the end of the year. The greenback jumped to a seven-month high on the news, weighing on dollar-denominated assets like crude oil and gold, while financial stocks rallied on hopes for the first interest-rate boost in years. By the time the dust settled, the blue-chip bulls prevailed and the Nasdaq Composite (COMP) moved higher, though the S&P 500 Index (SPX) resolved to the downside.
Continue reading for more on today's market, including:
The Dow Jones Industrial Average (DJIA - 17,910.33) spent time on both sides of breakeven, but busted higher in the final hour of trading, adding 46.9 points, or 0.3%, to end near a session high. Thirteen of the Dow's 30 components finished in the black, led by a 3.7% rally for Goldman Sachs Group Inc (NYSE:GS). UnitedHealth Group Inc (NYSE:UNH) paced the declining majority, dropping 1.2%. For the week, the Dow gained 1.4%, marking its sixth straight weekly advance.
The S&P 500 Index (SPX - 2,099.20) couldn't muster enough steam to break north, giving up 0.7 point, or 0.03%. The Nasdaq Composite (COMP - 5,147.12) fared the best of its peers, gaining 19.4 points, or 0.4%. For the week, the SPX added 1%, while the COMP gained 1.8%, with both indexes joining the Dow in their sixth consecutive week of upside.
The CBOE Volatility Index (VIX - 14.33) settled near a session low, dropping 0.7 point, or 4.8%, and ending a short-lived perch atop its 10-day moving average. For the week, the "fear gauge" slipped 4.9%.
5 Items on Our Radar Today:
- Today's much-anticipated nonfarm payrolls report showed an increase of 271,000 jobs last month, compared to an expected gain of 180,000, marking the biggest one-month surge since December 2014. The unemployment rate, meanwhile, hit a 7.5-year low of 5.0%. (Reuters)
- President Obama announced that the White House has rejected the Keystone XL pipeline, alleging that the project "would not serve the national interests of the United States." Energy security and environmental concerns were cited as key reasons for the rejection. (CNBC)
- Just hours after announcing a major purchase, the shares of BABA fell after short-seller Jim Chanos pitched BABA as bearish target. (CNBC)
- Oprah's recent investment skyrocketed after an earnings beat and increased guidance.
- Chipotle Mexican Grill, Inc. (NYSE:CMG) continued its slump as E. coli woes triggered a downgrade.
Commodities:
The rejection of the Keystone XL pipeline project and a falling number of U.S. operating rigs were not enough to keep oil from falling for a third day in a row. As the dollar soared, December crude oil lost 91 cents, or 2%, to settle at $44.29 a barrel. For the week, oil lost 4.9% -- the third week out of the past four in which black gold has suffered a loss.
December-dated gold hit a three-month low, falling $16.50, or 1.5%, to close at $1,087.70 an ounce. Pressuring the metal to its seventh straight loss was a strengthening dollar and the increasing possibility of a December rate hike. For the week, gold fell 4.7%, marking three straight weeks of losses.