Defying expectations of a sharp pull back relating to Superstorm Sandy, U.S. stocks opened higher on Friday (December 7) in the wake of data showing U.S. employment grew more than forecast in November.
The jobless rate fell to a near four-year low, but that was largely because so many Americans gave up the hunt for work.
Nonfarm employment increased by 146,000 jobs last month, the Labor Department said on Friday, defying expectations of a sharp pull back related to Superstorm Sandy.
The government said the storm which slammed the densely populated East Coast had not had a substantive impact on last month's employment and unemployment estimates.
U.S. financial markets appeared to put more faith in the payroll growth figures, with stock index futures turning positive and prices for U.S. government debt falling.
"The data is actually a pretty good progression. When you look at what's been happening over the last three months, we get this, companies are laying off or companies are not, and uncertainty. All of that is true, but when you really look at what's really been occurring, after the revisions because I think the revisions actually went down for the last two months, it's just a slow climb out, nothing dramatic, about as we had expected. So now also you have to put it into context, you really need, some economists would say, you need 150,000 maybe 170,000 jobs to kind of get above that turnover rate, but this is good news, particularly with Sandy as the backdrop," said Jeffrey Joerres, CEO of employment services group, ManpowerGroup.
The 0.2 percentage point drop in the unemployment rate to 7.7 percent -- the lowest since December 2008 -- represented a drop in both the labor force and employment as measured by a survey of households. Economists generally rely more heavily on the payrolls reading from the separate and much larger survey of employers.
But the numbers still had an impact on Wall Street with the Dow Jones industrial average gaining 57.29 points, or 0.44 percent, to 13,131.33. The Standard & Poor's 500 Index rose 6.09 points, or 0.43 percent, to 1,420.03. The Nasdaq Composite Index climbed 13.69 points, or 0.46 percent, to 3,002.96.