Dow Closes Week Higher as Tech Keeps Win Streak Live By Investing.com

By Yasin Ebrahim

Investing.com – The Dow closed the week higher Friday as tech’s strength helped keep its win streak alive amid easing worries about the Federal Reserve tapering its bond purchases following a soft jobs report.

The S&P 500 was up 0.52%, the Nasdaq Composite jumped 01.5% and the Dow Jones Industrial Average rose 0.52%, or 179 points.

The economy created 559,000 jobs in May, a sharp increase from the upwardly revised 278,000 in April, but short of economists’ forecast of 650,000.

While “this is not the ‘million jobs per month’ that looked like the base case expectation for the late spring ahead of the April payrolls data, it isn’t a disaster either,” Jefferies (NYSE:JEF) said.

Average hourly earnings climbed 2%, stoking inflation fears somewhat as rising wages are unlikely to be reversed. But some suggested businesses could pass on rising costs to consumers to mitigate wage pressure, keeping overall inflation in check.

The tepid jobs report added credence to the Fed’s stance to maintain its bond purchases until there was substantial progress on the economy. 

“Powell’s adjusted unemployment rate, which includes misclassified workers and labor force dropouts, declined by a more modest 0.2 % to 9.1%,” Jefferies added. [P]resumably the final destination is 4%, which is the Fed’s estimate of longer-run unemployment … [but] we’re only about one-fifth of the way toward that goal.”

Bets on a lower-for-longer Fed stance sent Treasury yields lower, pushing growth sectors like tech back on the trading menu.

With the exception of Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOGL) and Facebook (NASDAQ:FB), which together make up about quarter of the S&P 500 weighting, ended more than 1% higher. 

Energy stocks, meanwhile, were supported by rising oil prices amid expectations strong demand over the summer months will help offset the gradual increase in crude production from major oil producers next month.

The wild swings in so-called Reddit meme stocks like AMC Entertainment Holdings Inc (NYSE:AMC) continued as the movie chain tapped the market for more cash for the second time this week. Following its announcement to sell 8.5 million shares, AMC said Friday it may sell up to 11.6 million shares. GameStop (NYSE:GME) fell nearly 4%, while BlackBerry (NYSE:BB) was down 13%.

In other news, DocuSign (NASDAQ:DOCU) jumped nearly 20% after delivering better-than-expected guidance on revenue following a Q1 beat on both the top and bottom lines.