From The Associated Press
NEW YORK —
U.S. stock indexes edged up Friday, giving up some early gains fueled by stronger than expected jobs growth in June.
For some investors, however, the news left doubts about the strength of the economic recovery.
By midmorning, the Dow Jones industrial average was up 6.68 14 points, or 0.1 percent, to 14,995.23 after shooting up as much as 115 points earlier in the morning. The Standard & Poor’s 500 index was up 2.96 points, or 0.2 percent, to 1,618.37. The Nasdaq composite index was up 5.21, or 0.2 percent, to 3,448.88.
Investors seemed to be trying to make sense of the government’s monthly jobs report. The Labor Department said that the U.S. economy added a robust 195,000 jobs in June. That was above expectations for an increase of 165,000 jobs.
The report also said that the economy had added 70,000 more jobs in April and May than previously thought — 50,000 in April and 20,000 in May.
But investors had questions about some of the details.
“If you dig deep into the numbers it’s not a gangbusters in terms of employment,” said Jordan Waxman, managing director and partner at HighTower, a wealth management firm in New York. “The work week isn’t really getting longer, firms are being very selective about hiring, but they are on the mend.”
He said that companies have a better sense of certainty than they did at the beginning of the year, however, when there were more questions about the health care overhaul and the “fiscal cliff” budget and spending standoff in Washington.
The unemployment rate remained at 7.6 percent, as discouraged workers who had left the job search resumed their search for work. More than half the job additions came from hotels, restaurants, entertainment and retail, which are usually lower paying.
As investors bought stocks, they sold bonds: The yield on the 10-year Treasury note jumped to 2.65 percent from 2.56 percent, which meant that the government had to pay more to persuade investors to buy bonds. That was likely the product of two catalysts: Investors are feeling confident about putting money into stocks. But they also may be guessing that the Federal Reserve will soon stop buying bonds as a means to prop up the economy.
Friday’s jobs report reinforced the idea that the Fed could soon pull back on its economic stimulus measures.
The price of oil was up, nearing $102 a barrel in electronic trading on the New York Mercantile Exchange. That could signal that investors are optimistic about manufacturing and the broader economy — or it could mean they’re unnerved by political unrest in Egypt. On Wednesday, the military ousted Egyptian President Mohammed Morsi.
There were also reminders around the world that the economy is far from healed. Germany reported that orders for its industrial goods fell.
On Thursday, when the U.S. markets were closed for the Fourth of July holiday, the International Monetary Fund pressed Italy to do more about “unacceptably high” unemployment. In Portugal, politicians haggled over government spending cuts in a dispute that threatened to pitch the bailed-out country into turmoil and reignited concerns over Europe’s debt crisis.