Wall Street Shows Early Gains Despite Soft Jobs Data

Posted by Unknown on Friday, January 10, 2014

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Business Day |Wall Street Shows Early Gains Despite Soft Jobs Data

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Stocks rose modestly on Wall Street early Friday, even as the December jobs report came in much weaker than anticipated.

The Dow Jones industrial average rose 0.22 percent, the Standard & Poorâ€™s 500 gained 0.23 percent and the Nasdaq Composite added 0.35 percent at the open.

Equity futures sharply pared gains after data showed employers in the United States hired in December only 74,000 workers, the smallest increase since January 2011.

â€œThatâ€™s what markets do,â€ said John Canally, an investment strategist and economist for LPL Financial in Boston.

â€œYou have a bunch of traders sitting there looking at a number they donâ€™t know anything about, they see a weak number and they hit â€˜sellâ€™; and when people take a look through it again they will reconsider.â€

The drop in reaction to the jobs data was likely to be temporary because of indications that cold weather conditions may have had an effect.

â€œIt looks like itâ€™s a weather issue,â€ Mr. Canally said. â€œThe Fed will see through it as a weather issue. I donâ€™t think they will change after one month of anything bad or good â€” so they are going to stay the course.â€

Investors are still viewing economic data through the eyes of the Federal Reserve, trying to gauge the pace at which it will continue to reduce its monthly stimulus.

Alcoa reported a significant quarterly loss on Thursday after recent declines in aluminum prices; its shares fell 7.3 percent at the open.

Sears Holdingsâ€™ shares fell 14 percent in early trading, a day after the retailer reported steep declines in comparable-store sales at its Kmart and namesake chain for the crucial holiday season.

Shares of the trucking company YRC Worldwide fell 21.5 percent at the open, a day after workers represented by the Teamsters union rejected a contract extension that the company proposed. The rejection put a plan to restructure its debt in jeopardy, and shares plunged 16 percent on Thursday.

Target said a huge payment card data breach that occurred during the first three weeks of the holiday shopping season affected up to 70 million people, far more than previously estimated. Its shares fell 0.25 percent as the markets opened.