For the week, the S&P 500 rose 0.6 percent, while the Nasdaq climbed
1 percent. The Dow Jones industrial average finished the week down
Defensive stocks were the day's gainers, with utilities <.SPSMCU>
and telecoms <.SPLRCL> among the few rising for the day. Financial
<.SPSY> and energy <.SPNY> shares were the weakest for the day; both
are closely tied to the pace of economic growth.
Homebuilding stocks rose as the much weaker-than-expected payrolls
report drove the yield of the benchmark 10-year U.S. Treasury note
Shares of Lennar Corp <LEN.N> gained 2 percent to $39.19. The stock
of D.R. Horton Inc <DHI.N>, the largest U.S. homebuilder, added 1.8
percent to $22.15. The PHLX housing index <.HGX> climbed 1 percent.
The Dow Jones industrial average <.DJI> slipped 7.71 points or 0.05
percent, to end at 16,437.05. The S&P 500 <.SPX> gained 4.24 points
or 0.23 percent, to finish at 1,842.37. The Nasdaq Composite <.IXIC>
added 18.471 points or 0.44 percent, to close at 4,174.665.
U.S. Labor Department data showed only 74,000 workers were hired
last month, the smallest increase since January 2011, and
significantly below the 196,000 that economists had expected.
While the jobs report bucked the positive trend of recent employment
data — including the ADP report and jobless claims — the setback was
expected to be temporary amid signs that the number of hires may
have been affected by cold weather.
Investors continue to assess economic data through the Fed's eyes as
they try to gauge how quickly the central bank will reduce its
market-friendly bond purchases. December was the first payrolls
report since the U.S. central bank announced that it was reining in
the stimulus program.
"Since economic momentum had seemed to be picking up, there were
real concerns that tapering would become more aggressive throughout
the year — fears that this report has washed away," said Alec Young,
global equity strategist at S&P Capital IQ in New York.
"People are hoping this is an anomaly, and it seems like it was
related to the weather, but if it is a trend, then that is a real
threat to GDP and corporate earnings growth."
With the earnings season under way, shares of Alcoa Inc <AA.N> fell
5.4 percent to $10.11 a day after the company reported a massive
quarterly loss. Alcoa's results were hurt by recent declines in
aluminum prices and a non-cash impairment charge on smelter
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The pace of companies reporting earnings is expected to pick up in
the following week, when a number of banks report their quarterly
and full-year results.
"Macro has been trumping everything for a while, and certainly
Washington has been very important, but the spotlight goes on
corporate earnings next week," said Phil Orlando, chief equity
market strategist of Federated Investors in New York.
Only 5 percent of S&P 500 components have reported earnings so far,
with half of them posting better-than-expected profits and 62.5
percent topping revenue forecasts. Historically, 63 percent beat
profit estimates, while 61 percent beat on revenue.
Sears Holdings Corp <SHLD.O> shares slid 13.8 percent to $36.71 a
day after the retailer reported steep declines in comparable-store
sales at its Kmart stores and its namesake U.S. chain in the crucial
Target Corp <TGT.N> said a massive payment-card data breach that
occurred during the first three weeks of the holiday shopping season
affected at least 70 million people, more than double its previous
estimate. Its stock dropped 1.1 percent to $62.62.
Trading at one of the three options exchanges operated by the Nasdaq
OMX Group Inc <NDAQ.O> was briefly halted due to a computer-server
problem. Nasdaq shares fell 0.8 percent to $39.92.
About 6.5 billion shares traded on U.S. exchanges, slightly above
the 6.4 billion average so far this month, according to data from
BATS Global Markets.
Advancing stocks outnumbered declining ones on the New York Stock
Exchange by a ratio of about 3 to 1. On the Nasdaq, about 15 stocks
rose for every 11 that fell.
(Editing by Jan Paschal)
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