The Dow Jones Industrial Average was up 19.46 points to 17,573.93 points, the broader S&P 500 index 0.71 points, to 2,031.92 points, closing at unprecedented levels. This is the third consecutive session records for these two indices. The Nasdaq fell 0.13% by 5.94 percentage points to 4,632.53 points.
Toronto’s S&P / TSX index rose 127.45 points (0.88%) to 14,690 points.
“The market is coming off an incredible rebound these days” and there has been “little profit taking before the weekend,” said Mace Blicksilver of Marblehead Asset Management. But a report on employment is “not bad,” he said, finally enthusing investors.
The unemployment rate of the world’s largest economy fell to its lowest level since July 2008 in October to 5.8%, against 5.9% the previous month. And for the first time in six years, the number of unemployed fell below 9 million.
Hires were somewhat less convincing, the US economy has created only 214,000 jobs that month, less than expected (235,000), although the figures for the previous two months were revised upward, 256,000 in September and 203,000 in August.
In the end, “these figures are rather positive for the markets because they show that the improvement in the labor market is slow, which should allow interest rates.” Federal Reserve (Fed) rates “still remain low until in mid-2015 or after,” said David Levy of Kenjol Capital Management.
And besides, “imagine how the Fed rates rise when wages do not increase, almost blocking any real increase in prices,” argued Gregori Volokhine of Meeschaert Financial Services.
The improvement in the labor market and inflation at 2% are the main objectives of a central bank with a highly accommodative monetary policy that has proved vital to the market rebound in recent years.
Abercrombie & Fitch plunged
Traders also digested a burst of mixed results, including the giant media and entertainment Disney that has lost 2.17% to 89.34 dollars. Some analysts fear a slowdown in earnings growth after a record year in 2014.
On the other hand, health insurer Humana, penalized particularly for its mixed outlook for 2015, saw its stock fall by 6.64% to 130.58 dollars and Salix Pharmaceutical Group, which disappointed investors by dropping out 33.98% to 91.47 dollars.
In the same sector, which Allergan American activist investor Bill Ackman on Friday asked to organize an open auction between the two contenders, Valeant (-2.07% to 126.11 dollars) and Actavis (-1.79% US $245.91), lost 0.71% to 196.00 dollars.
The clothing group Abercrombie & Fitch collapsed 16.62% to 29.50 dollars after a quarter saw it blocked out by the rising dollar and a decline in attendance of its stores, including sales in Europe.
The operator of the Swiss-based oil rigs Transocean has postponed the release of its quarterly results due to less profitable than expected drilling contracts; the company’s results dropped 0.70% to 29.71 dollars.
Bank of America that reviewed afterwards down its results for the third quarter was flat at $17.36. JPMorgan Chase announced that they would remove 3,000 more jobs than originally planned this year in its retail banking activities and gained 0.36% to 61.45 dollars.
Struggling supermarkets Sears, that plan to create a real estate company (REIT) to which they cede ownership of 200 to 300 of their stores, soared 31.04% to 42.81 dollars. They remain in the red, but this must improve their liquidity.
The bond market rose. The yield on 10-year Treasury fell to 2.312% against 2.375% Thursday night, and 30 years bonds by 3.046% against 3.093%.