Dow up 128 as jobs report cheers Street

Updated: 9:44 p.m. ET, Monday.

Friday's gain was what you would call a relief rally.

There was worry all week about today's jobs report from the Labor Department. The report -- while hardly a barn burner -- was better than expected.

So, stocks shot up at the open and then weathered the disappointment a little later, with a report on the non-manufacturing economy from the Institute for Supply Management. The market goes into the Labor Day weekend with its first weekly gain after three weeks of declines. Markets will be closed Monday for the holiday.

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The Dow Jones industrials ($INDU) closed up 128 points, or 1.2%, to 10,448 and even pushed back into the black for the year. The Standard & Poor's 500 Index ($INX) added 14 points, or 1.3%, to 1,105, and the Nasdaq Composite Index ($COMPX) was up 34 points, or 1.5%,  to 2,234.

The Nasdaq-100 Index ($NDX.X) also moved up 30 points, or 1.6%, to 1,830 and also is back in positive territory for the year.

 

The Dow stumbled on Aug. 30 but enjoyed four straight up days, its longest winning streak since a four-day streak between July 22 and 27.

The Dow's 2.9% gain for the week was its largest since the week of July 19, when it rose 3.5%. The S&P 500 produced a 3.8% gain, with the Nasdaq up 3.7%.

While the blue chips are up 0.2% for the year, the S&P 500 is still off 1% and the Nasdaq is off 1.6%.

Crude oil closed down 42 cents to $74.60 a barrel and dropped 0.8% for the week.

Gold settled down $2.30 to $1,251.10 an ounce but climbed 1.1% for the week.

Interest rates were lower, with the 10-year Treasury yield rising to 2.71% from 2.628% on Thursday. The dollar was lower against major currencies.

Over the weekend, Oracle (ORCL) said that Mark Hurd, the former CEO of Hewlett-Packard (HPQ), will join as co-president. That will intensify the competition between Oracle and HP.

 

 Barclays (BCS) was about to promote President Bob Diamond to CEO. Diamond has headed the British financial giant's investment banking business and has been the public face of the company in the United Statets.

 

Markets for the week
			9/3/2010			8/27/2010			% chg.			YTD chg.
Dow industrials			10,447.93			10,150.65			2.9%			0.2%
S&P 500			1,104.51			1,064.59			3.7%			-0.9%
Nasdaq			2,233.75			2,153.63			3.7%			-1.6%
Russell 2000			643.36			616.76			4.3%			2.9%
Crude oil			$74.60			$75.17			-0.8%			-6.0%
(per barrel)
U.S. Dollar Index			82.12			82.97			-1.0%			5.0%
10-yr. Treasury			2.71%			2.65%			2.0%			-29.6%
Gold			$1,251.30			$1,237.90			1.1%			14.1%
(per troy ounce)

Some better-than-expected news on jobs
The U.S. unemployment rate rose to 9.6% in August from July, but there were two major offsets:

• Nonfarm payrolls, expected to fall 100,000 to 110,000, fell just 54,000.
• Private-sector payrolls rose 67,000. The consensus estimate had been about 30,000, with some economists predicting as few as 10,000 private jobs.

Moreover, dismal data from June and July were revised higher, which means the deep worries that came with the July report may have been somewhat misplaced.

To be sure, a 9.6% unemployment rate is a deep problem and not just for politicians, especially Democrats facing midterm elections. Long-term unemployment has deep implications for the economy, Richard Curtin, who runs the University of Michigan's Survey of Consumers, wrote today. It could cause "economic security to become consumers’ highest priority."

That, in turn, means abnormally high savings rates, deep aversion to risk taking of any kind -- even buying a home. And slow growth for a very long time.

President Obama again urged Congress to pass a package of measures to help small businesses, including tax breaks and aid to ease credit. He also promised to lay out new ideas to boost the economy next week.

Measures may include a permanent extension of the research and development tax credit, payroll tax relief to encourage new hiring and new infrastructure spending.

Energy prices -- New York close
			Fri.			Thur.			Month chg.			YTD chg.
Crude oil			$74.60			$75.02			-5.51%			-6.00%
(per barrel)
Heating oil			$2.0573			$2.0623			-1.48%			-2.76%
(per gallon)
Natural gas			$3.9390			$3.7510			-19.99%			-29.31%
(per mil. BTU)
Unleaded gasoline			$1.9078			$1.9148			-9.56%			-6.50%
(per gallon)
Retail gasoline			$2.6810			$2.6760			-2.19%			1.59%
(per gallon; AAA)

Non-manufacturing struggles
Meanwhile, the Institute for Supply Management said its non-manufacturing index fell to 51.3 in August from 54.3 in July. A reading above 50 means growth.

There were declines in the four major categories in the index with employment falling from 50.9 to 48.2, which means n non-manufacturing employers were cutting back.

Ending the week with a broad rally 

The Dow was up as many as 131 points just after the open. The indexes slipped a bit after the ISM report was released but moved higher again.

For the technically minded, the market is sending off some bullish signals. Most important: The S&P 500 is above 1,100 for the first time since Aug. 10.

Nine of the 10 S&P 500 sectors were higher, led by financial stocks. Utility stocks were the laggard, moving lower as interest rates have started to move higher.

All of the 30 Dow stocks were higher, led by JPMorgan Chase (JPM), Cisco Systems (CSCO), and American Express (AXP), up 2.7% to $39.17, 2.5% to $21.04 and 2.3% to $41.80, respectively. The laggards: McDonald's (MCD), AT&T (T) and Verizon Communications (VZ),  up 0.1% to $75.09, 0.2% to $27.44 and 0.3% to $30.20, respectively.

Ninety-two Nasdaq-100 ($NDX.X) stocks were higher. The index was up 30 points, or 1.6%, to 1,870, led by  NII Holdings (NIHD) and casino operator Wynn Resorts (WYNN), up 3.8% to $38.40 and 3.7% to $87.81, respectively. Wynn rose as Chinese authorities said gambling revenue in Macau grew 40% in August.

Apple (AAPL) was up 2.6% to $258.77. The Street.com said the company has doubled its iPad production to meet growing demand -- and, perhaps, to help fend off an impending Google (GOOG) Android tablet onslaught.

 

Morgan Stanley analyst Katy Huberty believes Apple has doubled its iPad "builds" to 2 million tablets a month, a figure that could increase again for the holiday season.

Google was up 1.5% to $470.30. Apple contributed 9.1 points to the Nasdaq-100's gain; Google's gain was worth 1.2 points. 

BP (BP) said costs related to the Gulf of Mexico oil spill have hit $8 billion. The company has paid out $399 million for damage claims. BP's American depositary receipts were up 2.4% to $37.43.

Mariner Energy (ME), whose production platform off the central Louisiana coast was hit with an explosion and fire on Thursday, was up 1.8% to $23.16. That puts the shares within 18 cents of their Wednesday close. The stock briefly fell nearly 20% Thursday morning before rebounding back to $22.75 on worries that the explosion might mean another big Gulf of Mexico oil spill. So far, there's no sign of an oil leak.

 

Goldcorp (GG) said it will buy Australian miner Andean Resources for $3.4 billion, topping an all-stock offer from rival Eldorado Gold (EGO). Goldcorp shares fell 2.2% to $42.84, while Eldorado fell 1.9% to $19.10.

 

Video-game maker Take-Two Interactive Software (TTWO) blew away second-quarter earnings and sales estimates late Thursday and offered an upbeat outlook. The company's $355 million in revenue was 18% more than analysts' estimates. Adjusted earnings landed at 28 cents a share, compared with projections for a 6-cent loss. Take-Two shares jumped 7.3% to $9.50. 

Campbell Soup (CPB) said its fiscal-fourth-quarter earnings rose 64% to $113 million, or 33 cents a share. Analysts had expected earnings of 30 cents. Revenue  declined 1% to $1.5 billion; analysts had expected $1.6 billion. Campbell's shares were down 3% to $36.21.

Wheat was up 4% to $7.0825 a bushel after Russia extended its ban on grain exports until late 2011 because of drought conditions. Wheat was up 6.8% for the week and is up 47% this quarter.

Corn moved up 3.9% to $4.4975 a bushel.

 

Material from The Street.com was included in this post.

Short hits from the markets -- New York close
			Fri.			Thur.			Month chg.			YTD chg.
Treasury yields
13-week Treasury bill			0.125%			0.125%			-7.41%			150.00%
5-year Treasury note			1.485%			1.424%			10.66%			-44.71%
10-year Treasury note			2.706%			2.628%			9.25%			-29.59%
30-year Treasury bond			3.783%			3.726%			7.08%			-18.49%
Currencies
U.S. Dollar Index			82.124			82.501			0.57%			5.00%
British pound			$1.5473			$1.5399			-1.39%			-4.35%
(in U.S. $)
U.S. $ in pounds			£0.6463			£0.6494			1.41%			4.55%
Euro in dollars			$1.2898			$1.2830			-1.20%			-10.01%
(in U.S. $)
U.S. $ in euros			€ 0.7753			€ 0.7794			1.21%			11.12%
U.S. $ in yen			84.53			84.27			-2.45%			-9.11%
Canada dollar			$0.963			$0.950			-0.91%			1.31%
(in U.S. $)
U.S. dollar			$1.039			$1.053			0.99%			-1.30%
(in Canadian $)
Commodities
Gold			$1,251.30			$1,253.40			5.89%			14.15%
(per troy ounce)
Copper			$3.4990			$3.4955			5.66%			4.56%
(per pound)
Silver			$19.490			$19.6720			8.26%			15.70%
(per troy ounce)
Wheat			$7.0825			$6.8075			2.16%			30.79%
(per bushel)
Corn			$4.4975			$4.3300			14.51%			8.50%
(per bushel)
Crude oil			$74.60			$75.02			-5.51%			-6.00%
(per barrel)