UPDATE: Dow, S&P set new records in strong week for U.S. stocks
By Anora Mahmudova and Carla Mozee, MarketWatch
NEW YORK (MarketWatch) -- The S&P 500 and Dow Jones Industrial Average closed at record levels in a holiday-shortened week, fueled by a jobs report that was far stronger than expected but nonetheless isn't shifting expectations about when the Federal Reserve will start raising interest rates.
Both the New York Stock Exchange and Nasdaq closed early at 1 p.m. Eastern Time for the July 4th holiday.
The Dow Jones Industrial Average (DJI) closed 92.41 points, or 0.6%, higher at the preliminary 17,068.26 and gained 1.3% over the week. The S&P 500 (SPX) added 10.81 points, or 0.6%, to 1,985.343 and was 1.3% higher on the week. The Nasdaq Composite (RIXF) added 28.19 points, or 0.6%, to 4,485.93 and finished the week with a 2% gain, its third weekly gain in a row.
Read the recap of MarketWatch's live blog of today's stock-market action.
Investors clearly welcomed a strong employment data, but decided the subdued wage growth means the Fed won't speed up its timetable for ending its unusually loose monetary policy.
"While the slack in the labor market is tightening, wage growth is still contained. This means that companies are still able to keep their profit margins. And as the ISM numbers indicated, services-sector growth is slowing slightly. Markets would like to see economic growth without a jump in inflation and that is a hard balance to keep," said Quincy Krosby, market strategist at Prudential Financial .
The U.S. economy added 288,000 new jobs in June, and the unemployment rate fell to 6.1%. Meanwhile, weekly jobless claims, a proxy for layoffs, ticked up 2,000 to 315,000 in the week ended June 28, hovering near a postrecession low for several months, the Labor Department said. Also read: 'Yabadabadu' and other reactions to the June jobs report