NEW YORK: Stocks surged on Friday, racking up a third straight day of gains, after a report showing US employers added jobs for the first time in eight months boosted investors' expectations for an economic rebound.
The rally helped major market gauges notch their biggest weekly gains in at least four months and helped them retake much of the ground lost in a sharp slide that began last week that pulled them to their lowest levels in at least a month on Tuesday.
The latest economic data helped soothe worries that the economic rebound would be held back by weakness in employment growth, which had been dogging Wall Street in recent weeks.
“Everyone has signed on to believe that the economy has, in fact, recovered. The question is whether it would be with or without the job market,” said Peter Gottlieb, president of Gottlieb Investment Management. “This latest report would seem to indicate that the job market was starting to respond to the turn in the economy.”
Technology stocks, like semiconductor giant Intel Corp., led the charge into positive territory.
The technology-laced Nasdaq Composite Index jumped 44.35 points, or 2.42%, to 1,880.57, based on the latest available figures. The broad Standard & Poor's 500 Index climbed 9.61 points, or 0.94%, to 1,029.85, and the blue-chip Dow Jones industrial average rallied 84.51 points, or 0.89%, to 9,572.31.
Trading was active, with about 1.5 billion shares traded on the New York Stock Exchange and 2 billion traded on Nasdaq.
For the week, the Nasdaq Composite ended with a gain of 4.9%, and the Dow finished with a gain of 2.8%. Both posted their biggest weekly gains since May. The S&P 500 rose 3.3% for the week, its largest weekly gain since April.
The government said the number of workers on US payrolls outside the farm sector grew by 57,000 last month, the first time since January that jobs were created and sharply contrary to Wall Street economists' forecasts for a loss of 30,000 jobs. The unemployment rate was unchanged at 6.1%.
Employment-related companies surged on the news. Monster Worldwide Inc., which operates a career Web site, jumped $2.61, or 10%, to $28.50. Robert Half International, a staffing company, rallied $2.14, or 11%, to $21.60.
Semiconductor stocks also took flight. Chip equipment provider KLA-Tencor Corp. shot up $3.35, or 6%, to $55.98, and rival Applied Materials Inc. jumped 91 cents, or 5%, to $19.46. Intel, the world's No. 1 maker of chips, advanced 99 cents, or 3.5%, to $29.61, and was the Nasdaq's second-most actively traded stock.
Software maker Siebel Systems Inc. climbed 45 cents, or 4%, to $11. The company said it expects quarterly total revenues toward the lower end of its forecast as competition grows, but it backed analysts' profit estimates.
Dow component Hewlett-Packard Co. surged 78 cents, or 4%, to $20.30. On Friday, it targeted customers of struggling competitor Sun Microsystems Inc., offering them $25,000 in free services to switch to HP computers that run the Linux operating system.
Starbucks Corp, the world's largest coffee shop chain, rallied 79 cents, or 2.7%, to $30.22. The company said sales at company-operated stores open at least a year grew 9 percent in September from a year earlier.
The session, however, was not without weak spots.
Medtronic Inc. shares fell to a four-month low as investors fretted over an apparent slowdown in sales of the company's profitable line of implantable cardiac devices used to regulate a dangerously rapid heartbeat. It ended with a loss of $2.37, or 5%, at $45.88. - Reuters