By Yasin Ebrahim
Investing.com – Wall Street surged on Friday, shrugging off the worst monthly U.S. jobs report in history as many expect the lifting of restrictions will kickstart labor market activity, while rising oil prices continued to underpin energy stocks.
The Dow Jones Industrial Average rose 1.49%, the S&P 500 gained 1.35%, while the Nasdaq Composite added 1.23%.
Nonfarm payrolls dropped by 20.5 million last month and the unemployment rate surged to 14.7%, according to the Bureau of Labor Statistics. But was not as bad as many had feared, with economists' forecasting 22 million jobs lost in April and an unemployment rate of 16%.
The bulk of the job losses were temporary and are expected to return as stay-at-home orders are gradually lifted and businesses start to open, according to Jefferies (NYSE:JEF).
"The good news is that our base case is that employment contracts modestly in May and returns to growth in June as businesses reopen and laid-off workers begin to return to work," Jefferies said in note. "We think it will take roughly two years to return to pre-COVID19 employment levels."
Rising energy, stocks, meanwhile, led the broader market rally as oil prices continued to climb amid ongoing hopes that the reopening of economies and output cuts will stem in the glut in crude supplies.
On the earnings front, meanwhile, investors digested mixed quarterly performance from corporates.
Uber (NYSE:UBER) rose 6.1% after the ride-hailing company reported bigger-than-expected loss, but reassured investors that the Covid-19 pandemic would set its path to profitability back by quarter rather than years.
The company previously said it expected to turn a profit in the fourth quarter of the year.
Roku (NASDAQ:ROKU) fell 8% as it warned growth in its ad business was expected to fall short of its initial expectations and reported mixed first-quarter results amid a surge in costs.
After reporting first-quarterly earnings that missed estimates, Walt Disney (NYSE:DIS) climbed 2.5% after it sold out all tickets for the reopening of Shanghai Disneyland on Monday.
In a sign of strong risk appetite, the CBOE Volatility Index, or fear index, fell 8.2% to a more-than-two-month low.