A better-than-expected reading on the job market propelled stocks to their fourth straight day of gains, putting a bullish stamp on the first few days of September trading after the worst month of August for U.S. equities in nearly a decade.

The Dow Jones Industrial Average ($INDU) rose 128 points, or 1.2%, to close at 10,448. The blue-chip index gained nearly 3% on the week, breaking a three-week losing streak that saw it close below 10,000 for the first time since early summer.

The broader S&P 500 ($INX) rose 14 points, or 1.3%, to end at 1,105, led by the financial sector, technology stocks and capital goods. The more volatile, tech-heavy Nasdaq Composite ($COMPX) added 34, or 1.5%, to finish at 2,234

Investors cheered the second surprisingly good reading on the state of the economy in as many days. The mother-of-all monthly releases -- the jobs report -- showed that the private sector added 67,000 jobs in August, the Labor Department said, or more than the 40,000 increase economists were expecting. True, the nation shed 54,000 jobs last month, but economists and the market were anticipating a number nearly twice that high.

Friday's encouraging jobs report follows yesterday's surprisingly strong reading on U.S. manufacturing by the Institute for Supply Management. The ISM's purchasing managers index, a closely watched gauge of business activity, increased to 56.3 in August from 55.5 in July. Economists, on average, were looking for the index to fall to about 53. A reading above 50 means business activity is expanding.

Bonds prices continued to come under pressure on the better economic news, with yield on the benchmark 10-Year Treasury note leaping to 2.71% from 2.63% Thursday and 2.57% on Wednesday. (Bond prices move in the opposite direction of yields.)

Kenny Polcari, managing director at interdealer broker ICAP Corporates, tells DailyFinance's Nikhil Hutheesing the ISM and unemployment data were just what the market needed after staggering out of August.

"At the beginning of the week it felt like the economy was going into a tailspin and all the talk of the double-dip recession," Polcari says. "And we ended up getting some positive [economic] news at the end of the week, specifically today's great news on the jobs picture, and we're getting nice relief rally."

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There are always good news and bad news. Media picks the headline according to market action. But stocks are a leading indicator. Stocks move first, economic effects become apparent later. This is because social mood drives the markets, economy, politics. And when the mood swings, people first buy/sell stocks, and act on economic activities later: http://www.tradingstocks.net/html/socionomics.html We just left a major stock market top behind. This may not just be a double dip. It is possible that March lows will not hold. The bear market rally of 2009 was expected after over sold conditions. But now we are back into bubble territory and coming down. Debt is the problem and we have more of it now. Nothing has been fixed. We have borrowed the stimulus and we have spent it. Now we are going to face a mountain of debt. Merely borrowing and spending money cannot make an economic recovery.

September 04 2010 at 3:28 PM Report abuse rate up rate down Reply


September 04 2010 at 9:02 AM Report abuse rate up rate down Reply

I am very happy that the stock market is doing well. That is a good sign but the stock market it NOT THE economy. THE economy is people with jobs that pay enough so that they can buy the goods and services that business offer. The stock market has been pivotal in exporting American jobs because publicly traded companies are punished if they do not preform at levels that Wall Street wants to see. Exporting labor costs to markets where union organizers are routinely murdered and there are no enviromental regulations is rewarded on Wall Street. Congress needs to change the rules and the tax codes such that the creation of living wage jobs here in America is rewarded and the hoarding of capital is discouraged. Wall Street should serve as a way for investors to bring capital to business and not as a big casino. Wall Street should work to enhance the economy not shiphon money out of it.

September 04 2010 at 9:02 AM Report abuse rate up rate down Reply

I thought it was always true that job growth was only an indicator that a recession was over. Profits and production and more efficiency come first. iF THAT THEORY IS CORRECT AREN'T WE ON THE ROAD TO RECOVERY?

September 04 2010 at 8:57 AM Report abuse rate up rate down Reply

If we get canidates that tell us they would repeal the perks that the senate and house get he/she would be a shoe in See full article from DailyFinance: http://srph.it/cXkENw

September 04 2010 at 8:54 AM Report abuse rate up rate down Reply

One week the Dow is up, the other it is down. It is constantly adjusting and it is crazy, barring any major crisis, to cheer or fret when it goes up and down. Of course, it is much better news to have it gaining.

September 03 2010 at 8:56 PM Report abuse +1 rate up rate down Reply

you have got to be kidding!!! Double dip recession here we come!!!!!

September 03 2010 at 7:30 PM Report abuse +1 rate up rate down Reply

Any excuse for a rally. Jobs number is good, oh really? The jobless percentage went from 9.5 to 9.6. Tell anyone you know that is unemployed how wonderful this rally is going. I think it's to time to help the people who need it and stop making excuses for making the SUPER WEALTHY richer. The trickle down theory went the wrong direction. I think the AVG American at this point has had enough of the lies and broken promises.

September 03 2010 at 7:18 PM Report abuse +1 rate up rate down Reply

Nice little sucker rally....be careful, be very very careful....

September 03 2010 at 6:24 PM Report abuse rate up rate down Reply

I thought the value of a stock was based on the company's value....if not, it's white collar gambling...plain and simple.

September 03 2010 at 6:19 PM Report abuse -2 rate up rate down Reply
2 replies to scottee's comment

it is

September 03 2010 at 6:23 PM Report abuse -1 rate up rate down Reply

If that's all you know about the value of a stock, I suggest you stay out of the market or do some homework.

September 03 2010 at 6:25 PM Report abuse rate up rate down Reply