FX.co ★ U.S. Stocks Extending Yesterday's Rally Following Jobs Data, Apple Earnings

On Friday, stocks saw a substantial rise, continuing the surge witnessed in the previous session. All major averages have reported an uptick, with the Nasdaq, heavy on technology stocks, taking the lead.

Although the major averages have retreated slightly from their peak levels, they remain robustly positive. The Nasdaq saw an increase of 306.22 points or 1.9 percent, ending at 16,147.18 points, the S&P 500 increased by 52.29 points or 1.0 percent to 5,116.49 points and the Dow rose by 353.10 points or 0.9 percent to 38,578.76 points.

The extended Wall Street rally comes after the Labor Department’s closely watched employment report showed that job growth in the U.S. was below expectations in April. Non-farm payroll employment rose by 175,000 jobs in April, following a revised surge of 315,000 jobs in March. Analysts had predicted a jump of 243,000 jobs.

The April report also revealed that the unemployment rate slightly increased to 3.9 percent from the 3.8 percent in March. Annual wage growth slowed to 4.0 percent in April from 4.1 percent in March.

After the report’s release, Treasury yields took a steep fall, further alleviating concerns over future interest rates.

Chris Zaccarelli, Chief Investment Officer for Independent Advisor Alliance, said that in a market worried about inflation, a weaker jobs report with slightly higher unemployment and lower-than-expected wage growth and job creation indicated easing wage-related inflation pressure.

Strong earnings news from Apple boosted market sentiment, with the technology giant’s stocks soaring by 6.7 percent after it reported better-than-expected quarterly results and announced a $110 billion stock repurchase.

However, a report by the Institute for Supply Management showed an unexpected contraction in U.S. service sector activity in April.

Asian stock markets, with the exception of Japan and mainland China, closed holidays, also reported gains on Friday. The Hang Seng Index in Hong Kong jumped by 1.5 percent, while Australia’s S&P/ASX 200 Index rose by 0.6 percent.

Major European markets also reported gains, with the UK's FTSE 100 Index, the French CAC 40 Index, and the German DAX Index all registering a 0.5 percent rise.

In the bond market, despite pulling back from their early highs, treasuries remain in positive territory, driving down the yield on the benchmark ten-year note by 3.7 basis points to 4.354 percent.