December 05, 2020: Wall Street stocks surged to fresh records Friday, extending a post-election rally as disappointing US jobs data boosted the prospects for fiscal stimulus.
All three major indices finished the week at all-time highs, with the Dow Jones Industrial Average gaining 0.8 percent to 30,218.26.
The broad-based S&P 500 jumped 0.9 percent to close at 3,699.12, while the tech-rich Nasdaq Composite Index advanced 0.7 percent to 12,464.23.
The rally came even following government data showing the jobs recovery stalled, as US employers added just 245,000 new jobs in November.
And though the unemployment rate dipped to 6.7 percent from 6.9 percent, the lowest since the pandemic struck, that was due to Americans leaving the workforce.
Noting that new Covid-19 cases are “raging” in the US, FHN Financial's Chris Low warned in a note “job growth will be sluggish for the next three or four months, minimum.”
Still, Low pointed out that US approval of the first coronavirus vaccine could come as soon as next week.
Analysts said the weak jobs data provides further impetus for Congress to enact a new stimulus package, and Senate Republican leader Mitch McConnell and House Speaker Nancy Pelosi have revived efforts to hash out a deal.
President-elect Joe Biden reiterated the need for immediate support, saying “if we don't act now, the future will be very bleak. Americans need help and they need it now.”
JJ Kinahan, chief market strategist at TD Ameritrade, said the fresh stock records “might seem jarring” in light of the soaring coronavirus counts in the United States, but noted that the market is looking to vaccines and an economic recovery in 2021.
“Keep in mind that the stock market is a forward-looking beast, meaning that current activity in the main indices may be reflecting a good bit of investor anticipation of what might happen months from now,” Kinahan said in a note.