NEW YORK — Stocks were moving higher in afternoon trading on Friday, despite the fact that Wall Street got a dismal jobs report for January that showed the U.S. economy remaining in dire straits due to the pandemic.
Investors continue to hope that more help for the economy is on the way from Washington. Overnight the Senate narrowly passed a measure that will fast-track aid.
The S&P 500 index was up 0.4 per cent as of 12:05 p.m. Eastern. It’s on track for a weekly gain of more than 4 per cent, which would be its biggest since November. The Dow Jones Industrial Average rose, 96 points, or 0.3 per cent, to 31,152 points. The Nasdaq composite rose 0.4 per cent.
The Department of Labor said that employers added only 49,000 jobs in the month of January, far below economists’ forecasts. The disappointing report came as much of the country remains saturated with coronavirus cases, which caused some jurisdictions like California or New York to partially shut down again last month. A report on Thursday showed the number of Americans who filed for unemployment benefits remained well above historic norms.
“It’s very consistent with data over last two months which show that job growth is slowing,” said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute.
Service industries continue to be the hardest hit by the pandemic as people continue to refrain from travel and dining out, among other activities.
“In some ways it seems the reopening economy is still struggling a little bit and it’s responsible for quite a few jobs,” Samana said.
Investors are focused on the prospects for more stimulus. President Joe Biden urged Democratic lawmakers this week to “act fast” on his economic stimulus plan. Democrats and Republicans remain far apart on support for President Joe Biden’s $1.9 trillion stimulus package, but it appears Senate Democrats will be using their new-found majority to push the measure through without Republican support.
The Russell 2000 index of smaller company stocks rose 0.9 per cent, outpacing other indexes, in a sign that investors were growing more confident about the economy’s growth prospects. The yield on the 10-year Treasury rose to 1.15 per cent from 1.12 per cent late Thursday.
Meanwhile companies that online investors have clambered to over the past few weeks continued to trade with heavy volatility. GameStop jumped 15.2 per cent to $61.65. GameStop’s share price is far below the high of $483 it reached last week but still well above the $17 it traded at near the beginning of the year.
