U.S. stocks notched their best day in a month on Friday, with the S&P 500 and Nasdaq closing at record highs after a second straight month of robust labor market data. Bobbi Rebell reports.
Strong jobs data lifting the S&P 500 and the Nasdaq to record highs and reviving talk of an earlier interest rate hike from the Fed. Banks including JP Morgan Chase, Bank of America and Citigroup rose because the sector stands to gain if rates rise. For the week, stocks were in the plus column as well. Michael Arone of State Street Global Advisors SOUNDBITE: MICHAEL ARONE, CHIEF INVESTMENT STRATEGIST, STATE STREET GLOBAL ADVISORS (ENGLISH) SAYING: "My expectation for the S&P 500 has been pretty similar throughout the year. I expect you will get the dividend yields. That is around 2 percent. You will get whatever earnings per share growth the stocks are able to generate. My expectation is that is going to be another 4 to 5 percent. So you are looking at a return of anywhere from 5 or 6 percent on the S&P 500 this year. " Labor market data improved for the second straight month. Nonfarm payrolls rose 255,000 in July- far exceeding forecasts of 180,000. The unemployment rate, at 4.9 percent, remains just below the 5 percent mark associated with full employment. Bristol-Myers stock plunged after its lung cancer drug failed in a late-stage study, while Merck, which makes a rival drug, rose. In Europe, a winning session to end the week in part because of solid corporate earnings.