U.S. stocks posted hefty gains today as a strong jobs report showed economic strength while also eliminating any doubt over an interest rate hike by the Federal Reserve later this month.
As a result, the Dow Jones Industrial Average added 370 points, or 2.1 percent, to close at 17,847 while the S&P 500 gained 2.1 percent to finish at 2,091. Retail stocks gained, but were not at the same pace as other sectors. Still, the S&P 500 Retailing Industry Group Index closed up 1.8 percent to 1,312.
Earlier in the day, indices in Europe closed down with London’s FTSE 100 losing 0.6 percent to 6,238 and the CAC 40 in Paris shedding 0.3 percent to 4,715. The DAX in Frankfurt dropped 0.4 percent to close at 10,752. In Asia, all of the majors indices ended the day in the red.
In the U.S. retail and fashion segment, some of the notable gainers included Express Inc., which was up 4.5 percent to $17.07 and L Brands Inc., which rose 3.7 percent to $99.47. Zumiez Inc. closed the day up 5.3 percent to $14.64 while American Eagle Outfitters Inc. rose 3.2 percent to $15.81. Most of the gains in the fashion apparel segment showed increases between 0.5 and 1 percent. For the 12-month period, though, fashion apparel and retail stocks are mostly down — with some exceptions, including pure-play online retailers.
IHS Global Insight chief economist Nariman Behravesh, said the “strong jobs report removes the last hurdle for a December Fed rate hike.”
In Behravesh’s research note, the economist described the addition of 211,000 jobs as “solid” and following “the blow-out one for October, strongly suggests that the August and September softness was a fluke.”
“For the past six months, average payroll increases have been over 200,000,” he added. “The equally solid gains over the past two months in the household survey employment and labor force numbers are also encouraging. While wage growth edged down a little in November, it was above the rate earlier in the year.”