U.S unemployment report fuels a 1.14% increase in the S&P 500 index

The U.S Bureau of Labour Statistics announced the unemployment rate on Friday to have expanded to 14.7% in the United States in April that came in better than the expected 16.0%. The optimism of the report fuelled a roughly 1% increase in Wall Street.

S&P 500 index weekly performance

All major stock indices in the U.S pushed higher on Friday and were reported on track to record significant weekly gains. In the benchmark S&P 500 index, all 11 sectors posted gains with materials .SPLRCM and energy .SPNY taking the lead.

Opening around 27 points up on Friday at 2,909, the S&P 500 index is currently trading at 2,920. Compared to 2,815 at which the index started the week, it is currently just over 3.5% up on a weekly basis. The index hit its record-high of 3,386 in January 2020 followed by a 3-year low of 2,237 in March.

Following the unemployment data, the Dow Jones Industrial Average saw a 1.22% increase (291.02 points) on Friday. Nasdaq Composite also surged 1.07% (96.01 points) while the S&P 500 index climbed 1.14% or 32.84 points.

Thanks to the U.S government’s unparalleled monetary and fiscal stimulus in response to the Coronavirus pandemic, the U.S stock indices have recovered sharply since late March. On Thursday, the tech-heavy Nasdaq Composite recovered from all of its 2020 losses to step into the positive territory.

U.S – China trade relations contribute to optimism on Friday

Optimism in the stock indices was also attributed to the overnight news that the U.S – China tension that flared earlier this week as the White House blamed the Asian superpower for the pandemic are showing signs of relief. Trade representatives from both countries were also reported to have discussed the Phase 1 trade agreement. China also pledged to improve the atmosphere on Thursday to move ahead with the implementation of the trade deal.

Individual companies like Uber and Noble Energy also contributed to the Wall Street optimism on Friday. Uber Technologies surged around 5.9% as the CEO said that ride volume has shown signs of recovery in the past three weeks. Noble Energy, on the other hand, gained roughly 10.7% as it expressed plans of slashing oil production and further reducing its capital expenditures in 2020 to cushion the blow from a recent crash in oil prices.

The benchmark SPX index recorded no new 52-week lows and 10 new highs. Nasdaq Composite also posted only one new 52-week low and 57 new highs.