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Dow Climbs as April Jobs Scare Tames Taper Tantrum Jitters

Stock MarketsMay 07, 2021 03:53PM ET
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© Reuters.

By Yasin Ebrahim

Investing.com – The Dow rallied Friday as an unexpectedly weak April jobs report cooled fears the Federal Reserve may be forced to tighten policy sooner than many expect to curb an overheating economy.

The Dow Jones Industrial Average rose 0.71%, or 244 points, after hitting an intraday record high of $34,811.39. The S&P 500 was up 0.80%, and the Nasdaq Composite gained 0.95%.

The U.S. economy created 266,000 jobs in April, below the 770,000 seen last month and well short of the 976,000 jobs economists had forecast.

The move cast doubt somewhat on the recovery, and eased fears that the Fed may have to start to talk about tapering its bond purchase.

"So much for 'a string' of 1 million payroll gains. That's what Powell wants to see before he's comfortable talking about tapering. The April miss makes it virtually impossible to get there by the June FOMC meeting," Jefferies (NYSE:JEF) said.

With the Fed's ongoing narrative of lower for longer rate environment strengthened, tech stocks moved higher as fears over a rapid pace of inflation and an overheating eased.

Google-parent Alphabet (NASDAQ:GOOGL), Microsoft (NASDAQ:MSFT), Facebook (NASDAQ:FB), and Apple (NASDAQ:AAPL), were higher while Amazon.com (NASDAQ:AMZN) remained below the flatline. 

Corporate earnings, meanwhile, continued to pour in.

Peloton Interactive (NASDAQ:PTON) was flat as exercise equipment maker flagged for a $165 million hit from the recall of its treadmills and cut its outlook on sales and profit. The company also reported Q1 results that topped analyst estimates. 

"[W]hile the recall saga is a tough pill to swallow for investors, the 30% correction is likely overdone," Wedbush said.

Beyond Meat (NASDAQ:BYND) slipped 5% after reporting a wider-than-expected loss of 42 cents per share as revenue fell on a pandemic-led dent in retail and restaurant demand. 

"We continue to be optimistic that a post COVID-19 environment coupled with recent partnerships could lead to improved fundamentals down the road, but the N-T outlook remains still quite challenging, in our view," Oppenheimer said in a note.

Roku (NASDAQ:ROKU) delivered a sanguine outlook on the year ahead after reporting earnings and revenue that beat analyst estimates, sending it shares more than 11% higher.

Dow Climbs as April Jobs Scare Tames Taper Tantrum Jitters
 

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Comments (13)
Adam Paine
Adam Paine May 09, 2021 11:51PM ET
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GREED
Young Bobby
Young Bobby May 07, 2021 6:44PM ET
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Inflation is going up and the Fed can nothing to control it.
Mitch Boch
Mitch Boch May 07, 2021 4:37PM ET
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Inflation is going up and the Fed can nothing to control it.
Mitchel Pioneer
Mitchel Pioneer May 07, 2021 4:10PM ET
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Another criminal day in the US Ponzi Scheme, greatest financial fraud in history, as the US working class is sent into yet another weekend with a financial knife in their back.
Joseph Biden
Joseph Biden May 07, 2021 3:28PM ET
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Who would want to work? I am giving people free welfare handouts so they can live in lazy poverty. I am Joseph Biden, if you ask me for ID then you are racist.
Casador Del Oso
Casador Del Oso May 07, 2021 3:28PM ET
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May I see your ID, please?
Joseph Biden
Joseph Biden May 07, 2021 3:22PM ET
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Hello, I am Joseph Biden. I am here to vote. If you ask me for ID then you are a racist.
Sloppy Joe
Sloppy Joe May 07, 2021 3:09PM ET
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better do not write anything...
Casil Casil
Casil Casil May 07, 2021 3:08PM ET
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If the jobs report was good, the indexes were still big green. Why? Nobody knows. Garbage indexes and Garbage dollars
William Bailey
William Bailey May 07, 2021 3:08PM ET
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Hahaha ... have a genuine problem, make up a reason.... as long as it is not the truth : Stock went up because wallstreet thinks a bad economy means more free money courtesy of the Fed !!! This crash will be epic and so will the chump-coin crash
CHAD TENDIES
CHAD TENDIES May 07, 2021 3:04PM ET
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So what happens when the federal reserve has to raise rates due to hyperinflation?
Edmund Bloom
Edmund Bloom May 07, 2021 2:15PM ET
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They pump today and then dump next week. Guaranteed!
Mario tragik
Mario tragik May 07, 2021 2:08PM ET
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Lol what? my god just don't write anything. You do not have to make up anything to make any sense of an irrational market.
Danny Ch
Danny Ch May 07, 2021 2:01PM ET
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This title lol
Dave Jones
Dave Jones May 07, 2021 2:01PM ET
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yeah I know right. what the fudge is it word salad time?
 
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