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Stocks surge to record highs after hiring climbs

Published: Saturday, May 4, 2013 1:15 a.m. CDT
Caption
(AP)
Specialists Devin Cryan (left) and Gabriel Freytes wear Dow 15,000 hats as they work at a post on the floor of the New York Stock Exchange Friday. A positive jobs report Friday lifted the stock market to a record high. The Dow Jones industrial average crossed 15,000 for the first time, and the Standard and Poor's 500 index, a broader market measure, rose above 1,600.

NEW YORK (AP) – Two of the most widely watched stock-market indexes marched past milestones Friday after a surprisingly good jobs report gave investors a clear sign of the U.S. economy’s strength.

The market jumped from the opening bell, traders donned party hats, and a wave of buying helped the Standard and Poor’s 500 index crack the 1,600 mark for the first time. The Dow Jones industrial average broke through 15,000.

“There’s euphoria today,” said Stephen Carl, the head equity trader at The Williams Capital Group. “That’s what you’d have to call it.”

On the floor of the New York Stock Exchange, brokers sported baseball caps emblazoned with “Dow 15,000.”

Investors are hoping it’s more than just a one-day celebration. Jobs are key to keeping stocks climbing. Big U.S. companies are making record profits, but much of that lately has come from cutting costs, not boosting sales. More jobs, and more consumer spending, would help.

The April jobs report was a good start. U.S. employers added 165,000 workers last month and many more in February and March than previously estimated. The unemployment rate fell to the lowest level in four years, 7.5 percent.

The Dow rose 142.38 points to close at a record 14,973.96, up 1 percent. The S&P 500 index climbed 16.83 points, or 1 percent, to 1,614.42, also a record.

“We’re breaking through psychological barriers and that will continue to bring investors off the sidelines,” said Darrell Cronk, regional chief investment officer for Wells Fargo Private Bank.

In its report, the government revised its previous estimate of job gains up to 332,000 in February and 138,000 in March. The economy has created an average of 208,000 jobs a month from November through April – above the 138,000 added in the previous six months.

“Jobs are key,” said Randall Warren, chief investment officer of Warren Financial Service in Exton, Penn. “Everyone is worried about things like fiscal policy, the government spending money it doesn’t have. If you want to turn that situation around, you have to get people off their couches.”

networking social media site, sank 13 percent, losing $26.08, to $175.59. The company issued a revenue forecast for the rest of the year that was well below what financial analysts were expecting. LinkedIn went public in May 2011 at $45 a share.

 

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