Stocks end week higher, despite jobs report

The major averages manage small gains after the government says the economy created 96,000 jobs in August, less than expected. Gold jumps as traders expect more Fed stimulus. Google tops $700. Pandora Media slumps as Apple may become a rival.

By Charley Blaine Sep 7, 2012 12:47PM
Charley BlaineUpdated: 7:53 p.m. ET

A last little buying spurt allowed the stock market to finish mostly higher today -- and for the week -- despite the big disappointment with the Labor Department's  August jobs report.

The economy added 96,000 jobs in August; economists had hoped for 130,000 or so new jobs. The unemployment rate dropped to 8.1%, but many would-be job seekers have stopped looking.

The disappointment raised expectations that the Federal Reserve will decide next week to start a new round of stimulus, although a Fed move is not a given. Fed Chairman Ben Bernanke has said the weak jobs picture is "of grave concern." The report won't help President Obama in his re-election campaign.

Google (GOOG) moved over $700 for the first time since Dec. 28, 2007, rising $6.75 to $706.15. It was within 5% of its all-time closing high of $741.79, set on Nov. 6, 2007. But Intel (INTC) was down 90 cents to $24.19 after the chip giant cut its third-quarter revenue estimate to $13.2 billion, down from $13.8 billion to $14.8 billion. The problem is declining personal-computer sales around the world.

The Dow Jones industrials ($INDU) closed up 15 points to 13,307. The Standard & Poor's 500 Index ($INX) was up 6 points to 1,438, and the Nasdaq Composite Index ($COMPX) was up 1 point to 3,136.

Article continues below.
The Nasdaq-100 Index ($NDX) was down 5 points to 2,825. The index includes Google and Intel and is heavily influenced by Apple (AAPL). Apple was up $4.17 to $680.44 after hitting a new intraday high of $682.17.

Amazon.com (AMZN) also hit a new high of $259.42 before falling back to $259.14, up $7.76. On Thursday, the company announced three new Kindle Fire tablet models and an upgrade to its existing tablet.

The Dow and S&P 500 hit four-year highs on Thursday and the Nasdaq and Nasdaq-100 reached nearly 12-year highs on hopes that a solution to Europe's debt crisis is coming into focus.

The Dow and the Nasdaq-100 were weighed down by Intel and Kraft Foods (KFT), which was off $2.32 to $39.99. Kraft is splitting itself in two on Oct. 1. One will be Mondelez International, which offered 2013 revenue and profit estimates that disappointed analysts. The North American grocery business, to be called Kraft Foods Group, will focus on cash generation and big dividends.

Pandora Media
(P), which operates an Internet-based music streaming service, was off $2.10 to $10.47 after The Wall Street Journal reported that Apple wants to license music with an eye toward offering virtual radio stations that play songs based on a user's preferences.

Thanks to Thursday's big rally, the week was a winner after two weeks of small declines. The Dow gained 1.65%. The S&P 500 was up 2.2%, and the Nasdaq is up 2.3%. For the year, the Dow has gained 8.9%, the S&P 500 has added 14.3%, with the Nasdaq up 20.4%.

Markets for the week



9/7/2012

8/31/2012

% chg.

YTD chg.
Dow Industrials

13,306.64

13,090.84

1.65%

8.91%
S&P 500

1,437.92

1,406.58

2.23%

14.34%
Nasdaq 

3,136.42

3,066.96

2.26%

20.39%
Russell 2000

842.28

812.09

3.72%

13.68%
Crude oil 

$96.42

$96.47

-0.05%

-2.44%
(per barrel)

0.00

0.00

0.00%

0.00%
U.S. Dollar Index 

80.23

81.22

-1.21%

-0.36%
10-yr. Treasury

1.66%

1.56%

6.34%

-11.22%
Gold

$1,740.50

1,687.60

3.13%

11.09%

Gold and metals jump; crude oil tops $96
Gold
(-GC) settled up $34.50 to $1,740.50 an ounce on the Fed speculation and on hopes the European bond-buying program envisioned by the European Central Bank will work. The settlement price was the highest since $1,788.40 on Feb. 28.

Silver rose $1.016 to $33.69 an ounce. Copper added 12.9 cents to $3.645 a pound.

For the week, gold was up 3.1% and is up 11.1% for the year. Silver rose 7.2% and is up 20.7% for the year. Copper climbed 5.4% for the week and is up 6.1% for the year.

Light sweet crude oil (-CL) in New York finished up 89 cents to $96.42 a barrel. Brent crude, a big determinant of gasoline prices, was up 83 cents to $114.32 a barrel. For the week, light sweet crude was off slightly. Brent is off 0.2%.

The national average price of gasoline was down slightly to $3.822 a gallon from Thursday's $3.823, according to AAA's Daily Fuel Gauge Report. The price is up 16.7% for the year and up 14.9% since July 2.

Energy prices -- New York close



Fri.

Thur.

Month chg.

YTD chg.
Crude oil (-CL)

$96.42

$95.53

-0.05%

-2.44%
(per barrel)











Heating oil (-HO)

$3.1489

$3.1425

-0.98%

8.05%
(per gallon)











Natural gas (-NG)

$2.6820

$2.7760

-4.18%

-10.27%
(per mil. BTU)











Unleaded gasoline (-RB)

$3.0196

$2.9910

1.57%

13.63%
(per gallon)











Brent crude 

$114.25

$113.49

-0.28%

6.40%
(per barrel)











Retail gasoline

$3.8230

$3.8230

-0.16%

16.70%
(per gallon; AAA)












The disappointing jobs report
The jobs report stalled the big rally cold. It reflects tepid economic growth at best. Private-sector job growth was just 103,000, the report said, and government employment dropped 7,000. That decline reflects falling employment in public higher education and local schools.

June and July job gains were trimmed by 41,000.

The labor-force participation rate fell to 63.5, the lowest rate since September 1981, when the economy was in the throes of a difficult recession.

The manufacturing sector, a closely watched barometer for the broader economy, lost 15,000 jobs.


Residential construction employment lost 1,100 jobs to 563,800, the Labor Department said. Employment in the sector has barely budged since bottoming at 560,700 jobs in November 2010. Put another way, 461,300 residential construction jobs were lost between April 2006 and November 2010. Only 3,100 jobs have been added since then.


Sectors that did show growth in employment tended to be lower-paying ones, Mark Vitner, a senior economist with Wells Fargo, told The New York Times. About 40% of the new jobs came from four sectors: retail, leisure and hospitality, temporary help services, and home health care services. 


"People are taking jobs they didn’t take in the past," Vitner said, "moving from sectors like construction into jobs at lower-paying, big-box retailers."


What the Fed may do

Most pundits now believe the Fed will act to stimulate the economy at its meeting to be held Wednesday and Thursday. There's a chance the Fed will decide to buy upwards of $500 billion in securities, probably mortgage-backed bonds, and it will say low rates will be in place until as late as 2015.


The bond purchase decision may be delayed, however.


Critics worry the low rates and mortgage purchases increase the risks of inflation. 


China's infrastructure plans boost steel, coal stocks

China reinserted itself as a player in global growth by announcing approval of a $157 billion plan to build or improve roads and railroads. That pushed steel and coal stocks sharply higher.

Coal producers Alpha Natural Resources (ANR) and Peabody Energy (BTU) were up 99 cents to $6.90 and $2.31 to $23.71, respectively. U.S. Steel (X) was up $1.68 to $20.89. Iron-ore producer Cliffs Natural Resources (CLF) added $5.05 to $39.91. Led by Alpha Natural Resources, the four were the top S&P 500 performers today.


Dow component Caterpillar (CAT) was the top Dow performer because of the China news, rising $3.31 to $88.10 and contributing 24 points to the blue-chip index by itself. Rival Joy Global (JOY) gained $3.54 to $56.63.


The week ahead: The Fed and Germany's high court

The week ahead is not crowded with a lot of economic or earnings reports, but two economic events will dwarf everything else.


The first comes Wednesday with the German Constitutional Court decision on whether the country can legally get involved with all the European debt resolution plans. The betting is the court will support the participation.


Second is the Fed meeting, which starts Wednesday. It will end Thursday with a decision on whether to do another round of stimulus. It will probably include the Fed's vowing to keep interest rates at "exceptionally low levels" into 2014.


The Fed will announce its decision late Thursday morning, and Chairman Bernanke will hold a news conference at 2:15 p.m. ET.


Metals, energy and fnancials lead the market

If you assume that more Fed easing means higher commodity prices, then metals and energy shares should move higher. They were kept the market going, along with financial stocks. Utility and consumer staples were the laggards.


While the Dow ended the day higher, it was evenly split between gainers and losers. Bank of America (BAC) and Caterpillar were the leaders and Kraft and Intel the laggards.


Meanwhile, 303 S&P 500 stocks were ahead on the day, with metals and coal stocks the leaders. Chip stocks were the weak links. Advanced Micro Devices (AMD) and Kraft Foods were the laggards.


Forty-eight Nasdaq-100 stocks were higher on the day, led by Green Mountain Coffee Roasters (GMCR), up $3.25 to $27.83, thanks to two analyst upgrades. Research In Motion (RIMM) and Amazon.com were next. Kraft and Micron Technology (MU) were the laggards.


Short hits from the markets -- New York close



Fri.

Thur.

Month chg.

YTD chg.
Treasury yields











13-week Treasury bill

0.1000%

0.100%

11.11%

900.00%
5-year Treasury note 

0.638%

0.676%

7.05%

-23.13%
10-year Treasury note

1.661%

1.673%

6.34%

-11.22%
30-year Treasury bond

2.826%

2.799%

5.29%

-2.18%
Currencies











U.S. Dollar Index

80.234

81.033

-1.21%

-0.36%
British pound

1.6005

1.5941

0.74%

3.01%
(in U.S. $)

 








U.S. $ in pounds

£0.625

£0.627

-0.73%

-2.92%
Euro in dollars

$1.28

$1.26

1.64%

-1.19%
(in U.S. $)

 








U.S. $ in euros

€ 0.781

€ 0.791

-1.61%

1.20%
U.S. $ in yen 

78.43

78.87

-0.08%

1.73%
U.S. $ in Chinese

6.37

6.34

0.04%

0.64%
yuan











Canada dollar

$1.022

$1.018

0.80%

4.22%
(in U.S. $)

 








U.S. dollar 

$0.979

$0.982

-0.80%

-4.05%
(in Canadian $)

 








Commodities

 

 

 

 
Gold (-GC)

$1,740.50

$1,705.60

3.13%

11.09%
(per troy ounce)

 








Copper (-HG)

$3.645

$3.517

5.44%

6.08%
(per pound)

 








Silver (-SI)

$33.6900

$32.6740

7.15%

20.69%
(per troy ounce)

 








Wheat (-ZW)

$9.0500

$8.9175

1.74%

38.64%
(per bushel)

 








Corn (-ZC)

$7.9950

$7.985

-0.03%

23.67%
(per bushel)

 








Cotton 

$0.7630

0.7599

-1.24%

-16.78%
(per pound)

 








Coffee

$1.6305

1.582

-1.03%

-29.00%
(per pound)

 








Crude oil (-CL)

$96.42

$95.53

-0.05%

-2.44%
(per barrel)










 
543Comments
Sep 7, 2012 1:32PM
avatar
Look - I stand to make more $ if Obama is re-elected as I can't possibly sell all the coins I purchased over years  in the next 60 days.  Maybe half will be gone.

But I do think we need to move on....

•    23 million Americans are out of work, have stopped looking for work, or are underemployed
•    $16 trillion national debt (that’s $50,000 for every American)
•    43 straight months of 8% or higher unemployment
•    4 straight trillion dollar budget deficits in a row -- more than any other president combined 
Sep 7, 2012 1:29PM
avatar
No matter who occupies the white house after november , the only way to completely turn things around is get rid of the lifetime members of congress ! all they can do is bitch an gripe about how bad the other person is doing the job, when they can't even get to their chairs without a MAP an their daliy meds so they can think somewhat clear on todays agenda! This is the new change we NEED!  All they do is screw things up for the NORMAL citizens daily life!!!!!!!
Sep 7, 2012 1:04PM
Sep 7, 2012 1:08PM
avatar
the path to recovery ends for obama on november 2.
Sep 7, 2012 1:20PM
avatar
I tried to believe what was said at the Democratic convention, then remembered the words were all written by professional speech writers ... I was a political speechwriter for many years,, and half of what I wrote was 'spin' ,,,
Sep 7, 2012 1:19PM
avatar

Food for thought if President Obama is reelected -

 

The following is information on the 4 oldest members of the Supreme Court and medical issues I am aware of.

 

Justice Ginsburg - age 77  - has had cancer 2 times

Justice Scala - age 74

Justice Kennedy - age 73 - has a stent

Justice Breyer - age 71

 

HYPOTHETICAL - (very possible) While serving his 2nd term in office one of these 4 dies -

 

President Obama nominates - ERIC HOLDER to serve -

 

Are you scared now! 

Sep 7, 2012 1:35PM
avatar

The reason employment numbers SUCK is small business makes up the vast majority of private sector hiring. Small businesses are on the sidelines not hiring because of UNCERTAINTY. Besides the economy, which we have dealt with forever, it's what is going to happen with tax rates so I know how much I can invest in my business, new regulations coming our way, employee costs (health care), difficulty in getting a bank loan for investment. This doesn't include the beating from the administration of not paying our fair share, we didn't build it, etc. When busy we are working overtime at 1.5 times pay. The money we are making is paying down debt and investing capital on automation to reduce labor. 

Sep 7, 2012 3:16PM
avatar

Here is a question to everyone and please answer with an open mind & not the political party you are associated with.

 

If you were the owner of a multi million dollar company and you wanted to hire a CEO to lead your company into a better financial position would you hire Obama based on what you have seen for the last 31/2 years? 

 

Vote Thumbs up if you would look for someone else to lead your company

Vote Thumbs down if you would hire Obama

Sep 7, 2012 2:16PM
avatar

The only way we will have responsable government again is if:

 

1) term limits for Congress. When they leave all benifits stop.

2) only 10% of any one profession can occupy the House or Senate. (getting rid of a bunch of Lawyers)

3) REAL TAX REFORM !! ( There is a reason that the tax code fills 168 volumes, LAWYERS!!)

Sep 7, 2012 1:40PM
Sep 7, 2012 1:10PM
avatar
What appened to the 200,000 reported earlier this week??  I stated at that time it would be changed who are you going to blame for this one????????? Always something comes out that changes stock outlook . TRY SOMETHING DIFFERENT FOR A CHANGE ( LIKE THE TRUTH) !  
Sep 7, 2012 3:35PM
avatar
If obama gets another four years, I will simply get in line for all the free stuff he is offering. Free stuff goes fast, and you have to be in line early before it is all gone. If obama gets another four, I see no reason to apply myself. I see no reason to try and better myself. I see no reason to be productive. If obama wins, I will concede that the rich are the problem and that they got rich at the expense of the poor. If obama wins again, I will dodge every tax I possibly can, and milk every government program that I can. If obama wins, we all lose.
Sep 7, 2012 2:30PM
avatar
How in the world did this very column report yesterday that the market spiked because of A) good news in Europe and B) the addition of 201,000 jobs ?   Today it is only 96,000 and no mention of the erroneous 201,000 !   Am I crazy ?
Sep 7, 2012 3:06PM
avatar
Hey - we all like Obama.
He is a Constitutional Lawyer... Harvard Grad... 
Obviously did not take any economics classes along the way...

Did figure out how to get around the Constitution...
Sep 7, 2012 2:59PM
avatar
‎2008 66.2 66.0 66.1 65.9 66.1 66.1 66.1 66.1 65.9 66.0 65.8 65.8
2009 65.7 65.8 65.6 65.6 65.7 65.7 65.5 65.4 65.1 65.0 65.0 64.6
2010 64.8 64.9 64.9 65.1 64.9 64.6 64.6 64.7 64.6 64.4 64.5 64.3
2011 64.2 64.2 64.2 64.2 64.2 64.1 64.0 64.1 64.1 64.1 64.0 64.0
2012 63.7 63.9 63.8 63.6 63.8 63.8 63.7 63.5
Labor participation rate now stands at an all time low since the administration took office, and all the media tells us Americans are getting back to work. Baby boomers are not retiring due to the loss of wealth and a dismal return on savings, if any. Many previously retired are retuning to the work force for the same reasons. Recent college graduates are faced with overwhelming student loan debt and no prospect for a job that will pay a living wage. What a bunch of lies and deception we are being fed every day. Europe is high on the stimulous fumes and nothing is fixed. Just more of the same, redistribution of assets, currency devaluation, pumping of markets, and no sound fundamentals, just more smoke and mirrors. Our government is pumping the financials to drive the market up, just look at XLF the financials ETF while the NASDAQ flounders. The higher the house of cards goes, the farther it has to fall. Resembles the great depression, only this time it's on a world scale.
Sep 7, 2012 2:26PM
avatar

Remember 545 people created all the mess we have today.

The House

The Senate

The President

The Suprem Court

Sep 7, 2012 2:58PM
avatar
How can you trust a party that doesn't even acknowledge God? They put God to a vote during their DNC convention, and God lost... It is very, very, very sad to see a nation built on the foundation of God and the pursuit of freedom of religion turn into a basket case of godless, arrogant, snobs.
Sep 7, 2012 3:10PM
avatar

notice all the previous months numbers are ALWAYS adjusted down. That means that we are being fed overly optomisitc informtaion to mold our opinions.

Being wrong the numbers once in a while is OK. Bing wrong everytime and always overstating is deliberate misuse of numbers

Sep 7, 2012 3:43PM
avatar

This is What You Don't Think

 

IF Obama gets relected & If the Country is still here after 4 more years of Democratic rule.

You will never get another Democratic elected to the Presidency EVER.

We will remember Jimmy then Obama and say NEVER again.

 

Regan gave Clinton a growing economy ( After Carter's mess) then Congress and Clinton passed the Bill that cause the Greatest Housing Bubble in history. Bush tried to pass legislation to rein in the lending but Congress killed it.

So, we gave you a chance that you could turn things around like Regan did. Oh well so sad!! Obama and his lefty gang did not have the experience in anything except reading great speeches.

Sep 7, 2012 2:53PM
avatar

biden 2012 - GM is not fixed. They still owe the american tax payer $26 Billion +. potus didn't "save" gm, he didn't go in there and turn the company around... Take away all government (tax payer) support for gm and it will collapse like the piece of crap that it is.

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[BRIEFING.COM] The stock market ended the midweek session on a mixed note. Blue chip listings bolstered the Dow Jones Industrial Average (+0.4%) and S&P 500 (+0.3%), while the Russell 2000 (-0.4%) and Nasdaq Composite (-0.02%) underperformed.

Equity indices began the day in the red, but wasted no time regaining their flat lines. Small-cap stocks were not as fortunate as the Russell 2000 spent the day in the red.

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