BEIJING – Wall Street closed out a solid week for stocks Friday with more record highs as traders took a discouraging jobs report as a sign that Congress will finally move to deliver more aid for the pandemic-stricken economy.
The S&P 500 rose 0.9%, notching its third all-time high this week. The Dow Jones Industrial Average, Nasdaq composite and Russell 2000 index of smaller companies also closed at record highs.
The gains were broad, with about 81% of the companies in the S&P 500 moving higher. Gains in technology, health care and energy stocks helped lift the market, outweighing losses in utilities and companies that rely on consumer spending. Treasury yields rose, a sign of growing confidence in the economic outlook.
Hopes remain deeply rooted on Wall Street that one or more coronavirus vaccines are coming to rescue the global economy next year. But efforts to contain a surge in new virus cases has stoked worries about more economic pain for companies and consumers.
That's why Friday's much weaker-than-expected jobs report perversely helped lift stocks. Investors are betting the report may be bad enough to help kick Congress out of its paralysis and deliver more support for the economy.
“In a twist of irony, the bad jobs number is positive for markets today,” said Keith Buchanan, portfolio manager at Globalt Investments. “The market is telling us today that if the labor market continues to show slowing momentum, it’s much more likely the powers that be in D.C. agree to something that’s material.”
The S&P 500 rose 32.40 points to 3,699.12. The benchmark index climbed 1.7% for the week, it's second consecutive weekly gain. The Dow picked up 248.74 points, or 0.8%, to 30,218.26. The Nasdaq picked up 87.05 points, or 0.7%, to 12,464.23.
Stocks of smaller companies, which have recently helped lead the market after lagging earlier this year, outgained the broader market Friday. The Russell 2000 climbed 43.75 points, or 2.4%, to 1,892.45, more than double the gain for the big stocks in the S&P 500.