US stocks climb on upbeat jobs report and rise in consumer confidence

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U.S. stocks ran sharply higher on Friday, with the S&P 500 bouncing back from a five-session drop, as an upbeat November jobs report had the jobless rate falling to a five-year low and a read on consumer confidence hitting a five-month high.

“It sounds like the market is getting to good news is good news, not bad news,” said Phil Orlando, equity market strategist at Federated Investors.

The nonfarm payrolls report was “excellent, across the board. I really can’t find a hole in this. We’re now looking at a four-month average of just over 200,000,” said Orlando.

And, the rise in sentiment “has positive implications on the potential for getting a better Christmas than we thought a few weeks ago. Consumer spending accounts for 70 percent of GDP, and with Christmas spending underway, this reading is critically important,” Orlando added.

  Name Price   Change %Change
DJIA Dow Jones Industrial Average 15967.54
 
146.03 0.92%
S&P 500 S&P 500 Index 1801.57
 
16.54 0.93%
NASDAQ Nasdaq Composite Index 4064.18
 
31.01 0.77%

Halting a five-session losing streak, the Dow Jones Industrial Average rose sharply, with all of its 30 components gaining.

The S&P 500 also rallied, with materials fronting gains that extended to all 10 of its major industry groups.

The Nasdaq‘s climb had it briefly clearing its loss for the week.

For every stock falling, three rose on the New York Stock Exchange, where 178 million shares traded as of 11:05 a.m. Eastern. Composite volume cleared 963 million.

The dollar edged higher against currency rivals and the 10-year Treasury yield declined 3 basis points to 2.85 percent, after leaping to 2.9 percent in the immediate aftermath of the jobs report.

Gold futures rose $2.10, or 0.2 percent, to $1,234.00 an ounce; crude futures gained 17 cents, or 0.2 percent, to $97.54 a barrel.

The CBOE Volatility Index (VIX), a gauge of investor uncertainty, fell below 14.

The government’s jobs report found 203,000 jobs were added in November, with the jobless rate falling to 7.0 percent. Analysts polled by Reuters had expected that 180,000 jobs were created last month, with unemployment marginally lower at 7.2 percent. 

“It was a really good jobs report. There were a lot of positives in there. Manufacturing jobs are at their best level in over a year. Construction jobs being higher again is always good for the economy,” said JJ Kinahan, chief market strategist at TD Ameritrade.

But Kinahan did not think the data moved any cuts in stimulus by the Federal Reserve into December.

“We do have this Fed meeting coming up, but that’s right over the Christmas holidays. It would be odd timing,” he said. Data on Thursday showed the economygrew faster-than-expected in the third quarter, fueling fears the Fed could start tapering before year ends, rather than in first quarter 2014.

Stocks furthered their gains after The Thomson Reuters/University of Michigan’s preliminary reading on consumer sentiment came in at 82.5 in December, beating expectations.

In corporate news, American Eagle Outfitters forecast current-quarter profit under expectations, with the teen-apparel retailer citing holiday discounts. Its shares fell sharply.

—By CNBC’s Kate Gibson

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