NEW YORK (AFP) - Wall Street stocks finished mostly higher Friday as investors greeted a strong US jobs report that raised the odds of a December Federal Reserve interest rate hike.
Several analysts said they now expect the Fed to move forward with a December hike after the Labour Department reported the US added a better-than-expected 271,000 jobs in October.
Investors have sometimes sold stocks out of fear of higher interest rates.
But “the interpretation is now that this report could mean stronger economic activity and in the long run that’s positive for equities,” said Peter Cardillo, chief market economist at Rockwell Global Capital.
The Dow Jones Industrial Average advanced 46.90 points (0.26 per cent) to 17,910.33.
The broad-based S&P 500 slipped 0.73 (0.03 per cent) to 2,099.20, while the tech-rich Nasdaq Composite Index rose 19.38 (0.38 per cent) to 5,147.12 Large bank stocks rallied in the expectation that higher interest rates will boost profits. JPMorgan Chase rose 3 per cent, Bank of America 3.7 per cent and Wells Fargo 1.8 per cent.
Dow member Disney jumped 2.4 per cent as profits for the quarter ending Oct 3 rose 7.3 per cent to US$1.6 billion (S$2.2 billion). Operating earnings rose at the ESPN sports network and the company’s parks and resorts business.
Valeant Pharmaceuticals International rose 3.8 per cent to recover some of its losses from Thursday, when it lost 14.4 per cent.
The Canadian pharma giant, which has faced criticism over its accounting and drug pricing practices, said Goldman Sachs on Thursday sold 1.3 million Valeant shares that were held as collateral for loans of US$100 million to Valeant chief executive J. Michael Pearson. Valeant said the loans went to finance charitable contributions and meet taxes related to compensation in Valeant shares.
Youku Tudou, the Chinese equivalent of YouTube, jumped 7.3 per cent on news it would be acquired by Chinese Internet giant Alibaba for about US$4.8 billion. Alibaba fell 2.1 per cent.
Weight Watchers International gained 35.20 percent after reporting earnings of 38 cents per share for the quarter ending Oct 3, well above the 29 cents forecast by analysts. Weight Watchers on Oct 19 announced Oprah Winfrey was joining the board, news that had propelled the stock higher ahead of the earnings report.
Bond prices fell. The yield on the 10-year US Treasury rose to 2.33 per cent from 2.24 per cent Thursday, while the 30-year advanced to 3.09 per cent from 3 per cent. Bond prices and yields move inversely.