By Paul R. La Monica, CNN Business
Friday kicked off with disappointing news as just 210,000 jobs were added last month, much lower than expected. Yet stocks still opened higher.
Investors seem to be betting that the weaker jobs gains will mean the Federal Reserve will keep propping up the economy — specifically, that the central bank won’t have to speed up its plans to unwind stimulus, and that it could also delay any interest rate hikes until later in 2022.
The market may also be cheering the fact that despite the tepid gains in the number of jobs added, the unemployment rate fell to a new pandemic-era low of 4.2%.
The Dow rose nearly 150 points shortly after the open, or 0.4%. The S&P 500 was up 0.6%. The Nasdaq gained 0.5%.
It’s been an eventful week for US stocks. Market volatility has returned with a vengeance as of late, starting with the massive drop in the abbreviated trading session on Black Friday last week due to concerns about the Omicron variant of Covid-19.
Stocks are still down a bit for the week, despite the rallies Thursday and Friday. They’ve been whipsawed on the news earlier this week that Omicron cases have arrived in the US.
Investors are also weighing comments from Federal Reserve chairman Jerome Powell, who testified to Congress Tuesday that the Fed had “retired” the use of the word transitory to describe current inflation.
Powell also freaked out markets by suggesting that the Fed could speed up its plans to cut back on, or taper, its bond purchase program. The Fed’s bond buys have helped keep long-term rates low.
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