Stocks Jump After January Jobs Report; Dow Tops 14,000
NEW YORK ( TheStreet) -- Major U.S. stock averages rose more than 1% Friday on the back of robust gains in January as traders focused on upward revisions in the latest payroll report and anticipated continued accommodative policy from the Federal Reserve in light of the lukewarm January jobs release.
Friday marks the first day of the month, a day that traditionally sees strong inflows of money into equities.
The markets have also been pleased with fourth-quarter earnings reports by and large. According to data from Thomson Reuters , the blended estimate for the fourth quarter, which reflects reported results and analyst expectations, is for year-over-year growth of 3.8% for S&P 500 companies, up from 0.1% in the third quarter. Forty eight percent of S&P 500 companies have reported so far.
The Dow Jones Industrial Average surged by 149 points, or 1.1%, to 14,010. The blue-chip index earlier broke 14,000 for first time since 2007. The Dow gained 0.8% for the week.
Breadth was extremely positive, with winners topping losers 28 to two. AT&T(T) , Bank of America (BAC) , Verizon(VZ) and United Technologies (UTX) shares were posting the sharpest gains. Chevron(CVX) also traded higher.
Chevron posted fourth-quarter earnings of $3.70 a share versus the average analyst estimate of earnings of $3.04 a share amid improvements in its downstream operations. Results in the 2012 period included a gain of $1.4 billion from an upstream asset exchange. Shares were up 1.2% on Friday.
Exxon, the world's biggest oil company, reported fourth-quarter earnings of $2.20 a share, beating the Wall Street target of $2 a share amid profit margin strength in its refining business. Revenue came in at $115.17 billion, compared with estimates of $117.25 billion. Shares were little changed.
Drugmaker Merck posted fourth-quarter earnings of 83 cents a share on revenue of $11.7 billion, beating the average analyst estimate of 81 cents a share on revenue of $11.48 billion.
The company said it expects full-year 2013 revenue to be near 2012 levels on a constant currency basis, and that at current exchange rates sales would be affected unfavorably by about 1% to 2%.
Shares slid 3.3%.
All sectors in the broader market were firmly planted in the green, spearheaded by gains in consumer non-cyclicals, consumer cyclicals, basic materials, technology, services, financials, basic materials and conglomerates.
In a report Friday, Cantor Fitzgerald noted that equity mutual funds and ETFs garnered a record $78 billion of money inflows in January, and that contrarians should be greatly concerned by these unprecedented inflows.