The Dow Jones and S&P Rose Even as Job Creation Dropped

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On Friday, the Dow industrial and S&P 500 posted record highs for a second day despite news that hiring had slowed in July. Seven of the ten S&P 500 sectors ended higher, due to gains in the consumer discretionary index .SPLRCD, up 0.7 percent.

Altogether, the Dow Jones industrial average was up 30.34 points, or 0.19 percent, to close at a record of 15,658.36. The Standard and Poor’s 500 index was up 2.80 points, 0.16 percent, to close at a record  of 1,709.67. The Nasdaq finished Friday up 13.84 points, or 0.38 percent, to close at 3,689.59.

However, a government report revealed that 162,000 jobs were created in July, which makes it the smallest number since March and far fewer than what economists expected. At the same time, the unemployment rate dropped to 7.4 percent, the lowest since December 2008.

“The employment number clearly was a surprise on the downside,” Eric Kuby, chief investment officer at North Star Investment Management Corp in Chicago, said. “That the jobs picture has improved is pretty well established, so [the report] may not be the driver that it was before.”

So far, of the 391 of the companies of the S&P 500 that have reported second-quarter earnings, 67.8 percent have done better than analyst expectations — which is close to the average beat over the last four quarters according to Reuters.

LinkedIn (NYSE:LNKD) was one of the big winners on Friday after several brokerages raised their price targets following the company’s Thursday results. Shares for the company rose 10.6 percent to finish at $235.58. On the Nasdaq, Dell (NASDAQ:DELL) shares gained 5.6 percent, rising to $13.68, on news that the embattled Chief Executive Michael Dell had announced a new deal that increases the likelihood of his $24.6 billion buyout going through.

Chevron (NYSE:CVX) was among several stocks trying its best to drag down the numbers. Shares for Chevron fell 1.2 percent to $124.95 and posted a 26 percent drop in quarterly profit. Time Warner Cable (NYSE:TWC) was another loser as shares fell 0.5 percent to $117.10 on the news that Cox Communications Inc. was in talks with Charter Communications Inc. (NASDAQ:CHTR) regarding a potential merger. Charter shares were up 4.7 percent to $134.

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