Economy

Stocks cut gains after Reuters reports big virus spike in Florida, Dow still up 200 points


Stocks rose sharply on Thursday as investors cheered a bigger-than-expected increase in jobs in June as the economy tries to claws back from the coronavirus shutdown.

The Dow Jones Industrial Average traded 412 points higher, or 1.6%. The Nasdaq Composite hit a record high, climbing more than 1%. The S&P 500 gained 1.4%.

Boeing contributed to the gains, rising more than 3% after the airplane maker completed recertification flights for its grounded 737 Max jet. 

Stocks that would benefit from an economic reopening also rose. Cruise operators Carnival, Norwegian Cruise Line and Royal Caribbean all gained at least 3.6%. United Airlines and Delta each traded more than 2% higher. American Airlines and Southwest advanced 3.3% and 2.8%, respectively. 

The government’s June jobs report showed 4.8 million jobs were created. Economists were expecting 2.9 million jobs were created. The unemployment rate fell to 11.1% from 13.3% in May. Economists were expecting a rate of 12.4%, according to Dow Jones. 

Last month, economists forecast a loss of 8 million jobs in May and the economy gained 2.5 million payrolls instead.

“The direction of the economy is certainly north,” Jim Paulsen, chief investment strategist at the Leuthold Group, said on CNBC’s “Squawk Box” following the report. “I think that’s all it has to do to continue to provide confidence, not only to investors, but also to companies and to consumers.”

Meanwhile, weekly jobless claims data was released Thursday morning. 

The Labor Department said Thursday that initial jobless claims rose by 1.427 million in the week ending June 27. Economists polled by Dow Jones expected initial U.S. jobless claims to rise by another 1.38 million, down from 1.48 million the week earlier.

The data also showed the number of continuing claims — the number of people receiving unemployment benefits for consecutive weeks — rose to 19.29 million, an increase of about 59,000. 

The moves Thursday followed the market’s first trading day in the third quarter. Both the S&P 500 and Nasdaq Composite gained during the regular session on Wednesday, with the latter jumping more than 1% to an all-time high. 

U.S. markets will be closed on Friday for the July Fourth holiday.

—CNBC’s Patti Domm contributed reporting.

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