US stocks climbed on Friday, led by technology shares after a tepid US monthly jobs report relieved investor concerns the Federal Reserve might rein in monetary stimulus soon.
US employers increased hiring in May and raised wages as they competed for workers. But the nonfarm payrolls increase of 559,000 jobs was below the 650,000 forecasts of economists polled by Reuters.
Investors were concerned that robust jobs report that pointed to rising inflation could prompt the Fed to pull back on stimulus put in place during the pandemic.
“It keeps pressure off the Fed and will enable them to keep their low-interest-rate policy in place longer and take more of a wait-and-see attitude,” said Jack Ablin, chief investment officer at Cresset Capital Management. “The opportunity to keep rates low is good news for risk takers.”
Unofficially, the Dow Jones Industrial Average rose 180.4 points, or 0.52 percent, to 34,757.44. The S&P 500 gained 37.14 points, or 0.89 percent, to 4,229.99 and the Nasdaq Composite added 199.98 points, or 1.47 percent, to 13,814.49.
The heavyweight S&P 500 tech sector jumped, as longer-dated US Treasury yields fell.
Tech and other growth stocks are seen as particularly vulnerable if inflation drives up bond yields and more heavily discounts the value of future cash flows. The Russell 1000 growth index outperformed the counterpart Russell value index.
“It’s just a risk-on trade because the market believes rates are going to stay lower for longer,” said Robert Pavlik, senior portfolio manager at Dakota Wealth.
Overall, the S&P 500 is up some 12 percent this year.
Shares of billionaire William Ackman’s Pershing Square Tontine Holdings dropped after news it was in talks to buy 10 percent of Universal Music Group.
Investors were watching progress for proposed US infrastructure spending. President Joe Biden was meeting with the main Republican negotiator on Friday in an effort to craft a deal that can satisfy their sharply divided camps.