Jobs, sentiment and manufacturing data push stocks higher

A good batch of economic data pushed the US stock market considerably higher today, 1 Jun, Friday. The economic data included stronger than expected increase in May nonfarm payrolls, a lower than expected increase in core-PCE, which is the Fed's favorite inflation indicator, and a reading on the ISM Index that suggested that the manufacturing sector remains in growth mode.

The Dow Jones Industrial Average closed higher by 40.47 points at 13668.11, Nasdaq closed higher by 9.40 points at 2613.92 and S&P 500 too closed higher by 5.72 points at 1536.34.

The Dow, S&P 500 and Nasdaq ended the week with gains of 1.2%, 1.4% and 2.2% respectively.

Wal-Mart, Exxon Mobil and Honeywell were the main Dow winners today while AT&T, Boeing, Verizon and Caterpillar were the main Dow laggards. Wal-Mart shares closed almost 4% higher at $49.47 as investors reacted positively to a new $15 billion stock buyback program and news that the company will slow its opening of stores.

S&P 500 pushed to a third record high for the week

When market opened in the morning, the major indices started the day on a positive note. Investors cheered the Labor Department's report that 157,000 jobs were created last month, exceeding forecast of 150,000. Unemployment held steady at 4.5%.

Separately, the Commerce Department reported that core consumer price inflation increased just 0.1% in April, bringing the year-over-year increase to 2%. This marks the first time in 14 months that core prices have been inside the Fed's unofficial target zone of 1% to 2%.

At the top of the hour, the May ISM Index, a gauge of national manufacturing activity, checked in stronger than expected at 55 (consensus 54.7).

With all these reports signaling a long term confidence in the market, S&P 500 was pushed towards its third record close for the week and Dow Jones also hit a new high during intra day trading.

10 year bonds at 9 month high

The yield on the benchmark 10-year Treasury note rose to 4.95% today, its highest level since August. The 30-year Treasury bond was down 25/32, yielding 5.061%.

Crude oil futures and gasoline futures climbed today and crude closed beyond $65/bbl. Light sweet crude for July delivery closed at $65.08/barrel (higher by $1.07/barrel or 1.67%) on the New York Mercantile Exchange. Prices are 7.5% lower than a year ago. For the week, crude futures lost 12 cents.

Today, trading volume was a bit light, with 1.481 billion shares traded on the New York Stock Exchange and about 1.917 billion on the Nasdaq. There were more than 11 rising stocks for every five on the decline on the NYSE and 18 winners for every 11 losers on the Nasdaq.

Market Snapshot:

Dow	13668.11	40.47	(+0.30%)
Nasdaq	2613.92	9.4	(+0.36%)
SP 500	1536.34	5.72	(+0.37%)

Market Internals: