Dow Jones Industrial Average Tops 17,000 After Strong Payrolls Data

  on July 03 2014 10:46 AM
Stocks
A trader works on the floor of the New York Stock Exchange, on Nov.12, 2013. Reuters/Brendan McDermid

The Dow industrials broke above the 17,000 milestone on Thursday and theS&P 500 came within 1 percent of piercing through 2,000 after the U.S. unemployment rate fell to its lowest in almost six years and the American economy created many more jobs than forecast.

The U.S. economy created 288,000 jobs in June and the unemployment rate declined to 6.1 percent, the lowest since September 2008.

The data confirmed expectations that the economy bounced back in the second quarter after a dismal start to the year, and will likely spark talk about the need for the Federal Reserve to normalize monetary policy sooner rather than later.

With the Dow at 17,000, Main Street is expected to take a closer look at stocks.

"It may give people pause to think what could go wrong. I wouldn't be anything more than vigilant," said John Manley, chief equity strategist at Wells Fargo Funds Management in New York.

"This market is driven by fundamentals; 17,000 is a psychological thing, probably not much more."

The Dow is however underperforming other major indexes so far this year. Blue chips are up 2.8 percent year to date, while the S&P 500 and Nasdaq have gained more than 7 percent each.

The Dow Jones industrial average rose 69.19 points or 0.41 percent, to 17,045.43, the S&P 500 gained 6.12 points or 0.31 percent, to 1,980.74 and the Nasdaq Composite.IXIC added 11.81 points or 0.26 percent, to 4,469.55.

The closing bell will ring at 1 p.m. (1700 GMT) and U.S. markets will be closed Friday for the Independence Day holiday.

Volkswagen (GER:VOWG) denied planning a bid for U.S. truck maker Paccar (NASDAQ:PACR) after analysts published comments in a research note from a senior executive of German rival Daimler (GER:DAIGn) saying he had heard of such a plan. Paccar shares were up 5.8 percent at $67.47.

Lululemon (NASDAQ:LULU) shares rose 3.9 percent to $43 as founder Dennis Wilson's advisers have been talking to private equity firms about a possible buyout, the Wall Street Journal reported, citing people familiar with the matter.

Regado Biosciences (NASDAQ:RGDO) shares fell 57.1 percent to $2.90 after the Data Safety Monitoring Board started an unplanned review of data from a trial and the company said patient enrollment has been paused until the DSMB returns with recommendations.

Activist hedge fund Jana Partners LLC reported a 9.9 percent stake in PetSmart (NASDAQ:PETM) and said it planned to ask the company to explore a sale, sending shares of the pet products retailer up 12.5 percent to $67.27.

(Reporting by Rodrigo Campos, additional reporting by Ryan Vlastelica; Editing by Meredith Mazzilli)

 

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