Wall Street stocks rose on Friday, following positive sentiments from the U.S. on Mexico tariffs as surprisingly weak jobs data pushed the odds for a rate cut from the Federal Reserve.
The Dow Jones Industrial Average built on gains seen Thursday to close higher, 263.28 points at 25,983.94. The gains were spurred by upsides for Microsoft and Apple stocks. The S&P 500 jumped more than a percentage to 2,873.34, with the tech sector outperforming. The Nasdaq Composite also gained, rising 1.7% to 7,742.10.
Data released Friday showed that the U.S. economy added up to 75,000 jobs over May, the second time in the last four months in which U.S. jobs growth did not hit 100,000.
The less-than-expected growth was more than half lower than the 180,000 that economists had predicted in a Dow Jones poll. Growth in wages also disappointed.
TD Ameritrade market strategist JJ Kinahan noted that the weak data would make people “want to sell the market.” nonetheless, he pointed out to this as a good case for the Fed to consider rate cuts and that possibility is the reason investors are hanging in there.
Expectations for a rate cut have risen, with the market now 27.5% hopeful for a June move by the Fed. It was 16.7% before the poor economic report released on Friday, data from the CME FedWatch tool showed. The market has also priced in lower rates by July, chances of a Fed cut by then currently standing at 79%.
Individually, Apple and Microsoft shares gained big this week. Apple surged 2.5% on Friday to see its weekly gains closing at 8%. Microsoft is 6.3% over the week.
However, shares in the banking sector traded lower, with Citigroup, Bank of America, and J.P. Morgan Chase all shedding more than 1% on the day. The major indexes are all up on the week. The Dow clawed 4.7% higher to post its biggest weekly gains since November last year. The S&P 500 and Nasdaq closed the week higher, at 4.4% and 3.9% respectively.