Advertisment
U.S. stocks roared back from a sharp selloff on Friday as a rally in bond yields eased, while a stronger-than-expected jobs report boosted optimism for a faster economic recovery.
The Dow Jones Industrials sprouted wings and flew 572.16 points, or 1.9%, to finish the day and the week at 31,496.30.
The S&P recovered 73.47 points, or 2%, to 3,841.94, after shedding 1% earlier.
The NASDAQ Composite regained 196.68 points, or 1.6%, to 12,920.15, as Apple climbed 3.1% and Microsoft gained 2.2%.
The NASDAQ fell more than 2% this week, and the tech-heavy benchmark briefly turned negative on the year. The S&P 500 gained 0.8% this week, snapping a two-week losing streak. The blue-chip Dow outperformed with a 1.8% weekly gain.
Stocks that would benefit from a rapid economic comeback jumped in the wake of the jobs report. The S&P 500 energy sector popped 3.9%, posting its best day since November. Occidental Petroleum jumped 4.5%, while Devon Energy rallied 8.4%. Financials and materials rose more than 2% each.
Tech shares with lofty valuations got hit by rising bond yields again, continuing the pattern this week. Higher rates decrease the present value of future cash flows, making long-duration assets less attractive. Tesla tumbled more than 12%.
Pandemic winners Peloton and Zoom Video have slid 19% and 14%, respectively, this week. Red-hot investor Cathie Wood, who focuses on innovative companies, saw her flagship fund lose double digits this week and wipe out its 2021 gains.
The U.S. Labor Department on Friday reported that non-farm payrolls jumped by 379,000 for the month and the unemployment rate fell to 6.2%. That compared to expectations of 210,000 new jobs and the unemployment rate to hold steady from the 6.3% rate in January, according to Dow Jones.
Friday’s rally followed a steep selloff on Thursday triggered by Federal Reserve Chair Jerome Powell’s remarks on rising bond yields. The Fed chair said the recent runup caught his attention but he didn’t give any indication of how the central bank would rein it in. Some investors had expected Powell to signal his willingness to adjust the Fed’s asset purchase program.
Prices for 10-Year Treasurys sagged, raising yields to 1.57% from Thursday’s 1.55%. Treasury prices and yields move in opposite directions.
Oil prices picked up $2.45 to $66.28 U.S. a barrel.
Gold prices shed $4.30 to $1,696.40.
