Drop in Unemployment Rate Sends Stocks Higher
May 3rd 2013 3:33PM
Updated May 3rd 2013 4:20PM
A stronger-than-expected jobs report from the Department of Labor has sent stock markets surging higher today. The U.S. economy created 165,000 jobs in April, and the unemployment rate fell to 7.5% -- the lowest level since 2008. Both numbers beat estimates, and adjustments to March and February numbers added another 114,000 jobs. As a result, the Dow Jones Industrial Average is up 0.89% and the S&P 500 has risen 0.96%.
Alcoa is one of the leaders on the Dow, climbing 2.2% today. The company announced a $275 million investment in a Tennessee plant to increase aluminum-sheet production for the auto industry. It also said it was considering shutting down 11% of its aluminum-smelting capacity because of weak demand. Aluminum prices have fallen to a level that makes this a prudent move, and with 13% of capacity already sitting idle, it would save the company money without hurting revenue.
General Electric is up 1.3% after the Federal Trade Commission gave the OK to its $3 billion acquisition of Lufkin Industries. GE is trying to increase exposure to the oil and natural-gas shale boom in the U.S., and this was a piece of that strategy.
One company not enjoying the day's gains is JPMorgan Chase , which has fallen 1.1%. The Federal Energy Regulatory Commission is looking into the company for possibly manipulating energy markets. JPMorgan once had a sterling reputation, but it's coming under heat from a number of regulators, and this is another caution sign investors should be worried about.
With big finance firms still trading at deep discounts to their historical norms, investors everywhere are wondering if this is the new normal or if finance stocks are a screaming buy today. The answer depends on the company, so to help figure out whether JPMorgan is a buy today, check out The Motley Fool's premium research report on the company. Click here now for instant access!
The article Drop in Unemployment Rate Sends Stocks Higher originally appeared on Fool.com.Fool contributor Travis Hoium has no position in any stocks mentioned. The Motley Fool owns shares of General Electric Company and JPMorgan Chase & Co.. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.