Wall Street ends week higher on improved sentiment and upbeat data
Major equity indexes in the U.S. recorded modest gains on Friday to close the week on a positive note after today's data from the U.S. ramped up the rate hike expectations, allowing financials to record solid gains.
Today's jobs report, which showed an increase of 209,000 in nonfarm payrolls, is assessed as a factor that could allow the Federal Reserve to start shrinking its $4.5 trillion bond portfolio as early as September. Moreover, according to the CME Group FedWatch tool, the odds of a 25 bps rate hike in December, the third of the year, also increased after the data.
JP Morgan Chase shares gained 1.3% while the Goldman Sachs became the best performer of the Dow Jones Industrial Average as it added more than 2% on Friday. After rising to 422.26, the S&P financial index .SPSY closed the day at 420.74, up 0.7% on the day.
In the meantime, solid second quarter earnings results kept coming on Friday, further supporting the equity indexes. "We would expect next week to see market highs again just based on the positive tone created by strong second-quarter earnings and favorable outlooks," Tim Ghriskey, chief investment officer of Solaris Group, told Reuters.
The Dow Jones Industrial Average added 52.86 points, or 0.24% to 22,078.96, the S&P 500 rose 0.07 %, or 1.75 points, to 2,474.33, and finally the Nasdaq Composite gained 4.54 points, or 0.07%, to 6,344.88.
Headlines from the U.S. session:
- US: CPI to show a modest rebound in July - Wells Fargo
- US Dollar quiet around mid-93s, looking to close first week of August on a high note
- US: July NFP consistent with economic growth - Wells Fargo
- CME Group FedWatch's December hike probability advanced to 47%
- US: Trade deficit narrowed in June on export growth - Wells Fargo
- US NFP: Federal Reserve likely to continue tightening on strong jobs report - Danske Bank
- WH Eco. Advisor Cohn: Comprehensive tax bill to be completed in early fall - BBG
- Atlanta Fed: GDPNow model forecast for real GDP growth in Q3 is 3.7%
- NY Fed: GDP Nowcast stands at 2% for Q3 of 2017
- US: Good jobs report offers clear positives for the Fed - ING
- US: Goods and services deficit was $43.6 billion in June, down $2.7 billion from May
- US: Total nonfarm payroll employment increased by 209,000 in July