The Associated Press
NEW YORK —
Investors welcomed news that the U.S. unemployment rate declined last month, driving major stock indexes higher in morning trading Friday. The gains added to a strong finish for stocks a day earlier. Expedia and several other companies rose sharply after reporting higher earnings than analysts were expecting.
KEEPING SCORE: The Dow Jones industrial average rose 59 points, or 0.4 percent, to 15,687 as of 11:34 a.m. Eastern time. The Standard & Poor's 500 index added nine points, or 0.5 percent, to 1,782. The Nasdaq composite gained 33 points, or 0.8 percent, to 4,090.
UNEMPLOYMENT FALLS: The Labor Department said early Friday that the nation's unemployment rate dipped to 6.6 percent in January from 6.7 percent in December. It was the lowest rate since October 2008.
WEAKER JOB GROWTH: The January jobs report showed that employers added 113,000 jobs, less than the average monthly gain of 194,000 in 2013. This follows December's tepid increase of just 75,000. Job gains have averaged only 154,000 the past three months, down from 201,000 in the preceding three months.
INVESTORS REACT: Stocks initially turned lower right after the jobs data came out, then quickly reversed course, noted Chris Gaffney, a senior market strategist at EverBank. "I can only point to the improvement in the unemployment rate as the reason for that," Gaffney said. "The jobs numbers were definitely disappointing."
BROADER GROWTH TREND INTACT? Some market watchers interpreted the latest job numbers as not necessarily indicative of the overall strength of the U.S. economy and job market, citing the likely impact of unusually harsh weather that battered much of the East Coast this winter. "This was heavily influenced by cold weather in January and should not be viewed as a break in the trend," said Tim Hopper, chief economist at financial services company TIAA-CREF.
U.S. EARNINGS: Online travel service Expedia soared $9.25, or 14 percent, to $74.39 after reporting that its profit and revenue jumped on increased hotel bookings and revenue from a new venture. LinkedIn fell $15.20 or 6.8 percent, to $208. after the company said its performance may falter this year as it spends more on long-term projects and revenue growth slows. Fairway, a grocery store chain, plunged $3.18, or 27.8 percent, to $8.25 after it reported a loss in its fiscal third quarter and said its CEO is stepping down.
BUYING BONDS: The yield on the 10-year Treasury note edged down to 2.66 percent from 2.70 percent as investors moved money into bonds. It slid as low as 2.63 percent shortly after the jobs report came out at 8:30 a.m. Eastern time. The yield, which affects rates on mortgages and other consumer loans, had been edging higher after falling to 2.58 percent on Monday, the lowest level in more than two months.
BON VOYAGE: Online travel sites were soaring in early trading. In addition to Expedia, TripAdvisor leaped $7.20, or 9.3 percent, to $84.34.
MOVING ON UP: Among the stocks posting early gains were News Corp., which rose $1.18, or 7.4 percent, to $17.20. Retailer The Gap also added $2.21, or 5.6 percent, to $41.92.
SLIDING DOWN: Cigna led the roster of decliners in the S&P 500 after reporting earnings that fell short of analysts' expectations. The company sank $8.31, or 9.6 percent, to $77.15. Also sliding was Wyndham Worldwide. It shed $3.71, or 5.1 percent, to $68.67.
EUROPE UPBEAT: European stocks indexes were mostly higher as traders digested the U.S. jobs report. Germany's DAX rose 0.5 percent at 9,298 while the CAC-40 in France rose 0.9 percent to 4,226.