US stocks ended the week at the top of their Friday session range after stronger-than-expected non-farm payrolls confirmed a Federal Reserve rate hike on March 15.
The S&P 500 ended up 0.3% at 2372. However, on the week it went nowhere.
The top S&P 500 gainer on Friday was Incyte Corporation (NASDAQ:INCY) up 8.1% to $149.24. The stock turned red hot after reports that Gilead Sciences, Inc. (NASDAQ:GILD) was close to an agreement to buy Delaware-based biopharmaceutical company Incyte. Talks are said to be at an advanced stage but specifics on timing and price weren't mentioned.
Gilead, based in California, has been under intense pressure from investors to find a way to convert its multi-billion cash hoard into growth, but recent efforts have fallen flat.
Gilead shares ended down 0.3% at $68.19.
The S&P Midcap 400 ended up 0.4% at 1710 and led by Jetblue Airways (NASDAQ:JBLU) up 5.1% to $20.05. Investors finally appeared to be willing to help the stock recover after its disappointing January traffic data, especially after the release of its relatively comforting February figures.
The key detail from JetBlue’s February traffic report is the year-over-year increase in revenue per available seat mile (RASM). The company said that its preliminary RASM for the month increased approximately 1.5% from the year-ago period.
The S&P Smallcap 600 closed up 0.4% at 830 and led by construction group Myr Group Inc (NASDAQ:MYRG) up 13.2% to $41.98 after it was upgraded by Zacks Investment Research from a “sell” rating to a “hold” rating. On Thursday the company presented Street-beating earnings figures.
Early trading
US stocks advanced on Friday after a stronger-than-expected Employment Report and a certainty of a rate hike next week fanned the flames of a rally started by oil prices.
The S&P 500 market bellwether was up 0.3% at 2372 while the Dow Jones Industrial Average was up 0.2% at 20,888, having earlier come within 60 points of hitting 21,000 again after a week’s absence.
The tech-heavy Nasdaq Composite was up 0.4% at 5862.
US stocks climbed higher after non-farm payrolls of 235,000 in February surpassed a forecast of 190,000 jobs created, and showed continued tightening in the labour market would give the Federal Reserve the green light to hike rates by 25 basis points on March 15.
Meanwhile, oil, which began the day markedly higher, was last seen lower. The WTI was down 0.7% to $48.95 after investors began to reassess that, after all, the oil glut could be here to stay.
Figures mid-week from the EIA supported that, although renewed optimism began to filter back into the market on Thursday.
The impression of oil price stability has been held in place by three forces: OPEC and its cartel supply cull pledge last November, hedge fund investors and shale oil producers in the US. The fragile balance now appears to be unravelling and augurs volatility ahead rather than rises energy prices.
The top gainer on the S&P 500 index was Staples (NASDAQ:SPLS) which recovered from previous day’s losses and was up 4.6% at $8.88 after poorer results. But the rebound on Friday was largely because of the action Staples plans to now take.
Staples, the largest office supply chain in the US has made an announcement of closing down 70 stores across the country because of drop in sales.
Meanwhile, the S&P Midcap 400 was up 0.3% at 1709 and led by Polaris Industries Inc (NYSE:PII) up 5% at $91.24 after receiving a consensus recommendation of “Hold” from the twenty-three analysts that are currently covering the firm. The average 12-month target price among brokers that have updated their coverage on the stock in the last year is $84.02.
The S&P Smallcap 600 was up 0.4% at 830 and led by Myr Group Inc (NASDAQ:MYRG) up 14.4% to $42.42 after it was upgraded by Zacks Investment Research from a “sell” rating to a “hold” rating. On Thursday the company presented Street-beating earnings figures.
Pre-Open
US stocks are set to open higher on Friday after non-farm payrolls came in stronger than expected and oil prices broke two sessions of declines to rise.
Equity futures were already solidly higher thanks to the West Texas Intermediate advancing by 0.5% to $49.52 before the US jobs data.
But the S&P 500 extended gains of 0.3% to 0.4% while the Nasdaq Composite and Dow Jones Industrial Average were both indicated 0.4% higher.
Some 235,000 jobs were created in February – well above a decline to 190,000 jobs created – from 238,000 in Janaury.
The report captured the first full month of job growth under President Donald Trump, and provided the earliest reading of progress toward his campaign promise to create 25 million new jobs over the next 10 years.
A solid report on Friday also cleared the way for the US Federal Reserve to raise interest rates next week at the end of its two-day meeting on March 15. Although 98% priced in by markets a week ago, the central bank has been waiting to make sure the economy is in a position of strength before hiking rates. Now it has been given the green light to proceed.
The gains for oil were an important underpinning to any rally this session, with the Dow now set to break above the 21,000 level again – just.
The move higher follows two very rough trading sessions for the commodity, which fell below $50 this week for the first time since December.
Investors are worried that an OPEC deal to cut production may not be enough to prevent oversupply in the market.
Data released this week showed that U.S. crude stockpiles are at record highs. American shale producers could deepen the oil glut as their output recovers.