July 03--TODAY'S INDEXES -- Dow Industrials 17068 +92
S&P 500 1985 +11
Nasdaq 4486 +28
DOW DELIGHT: The Dow Jones industrial average busted through the 17,000 mark today -- a record high -- propelled by a powerful burst of hiring in America.
Stock traders celebrated the news that the nation added 288,000 jobs last month, driving the unemployment rate to 6.1 percent.
The Dow ended the day at 17,068, up 92 points for a 0.54 percent gain. The S&P 500 gained 0.55 percent and the Nasdaq rose 0.63 percent.
The head of the European Central Bank added to the glee by pledging to keep interest rates down in Euroland. The Euro Stoxx Index gained 1.15 percent.
The bond market snoozed through it all as the yield on the 10-year Treasury barely budged at 2.64 percent.
Health care and telecom stocks were the best performing sectors on the session, noted Wells Fargo Advisors. Pfizer rose 1 percent and Verizon 0.6 percent. Utilities were down the most with a utilities index falling more than 1.9 percent.
ANALYST INSIGHT: The good news for jobs may cause the Federal Reserve to hasten the day that it begins raising short-term interest rates, analysts are saying. "The stellar jobs report hits the Fed right between the eyes on how good the labor market conditions out there truly are," said Chris Rupkey, chief financial market economist for the Bank of Tokyo-Mitsubishi, as quote by Bloomberg. "It shows how far behind the curve they are," he said.
The nation's job count has now topped 200,000 for five months in a row. Rupkey thinks the Fed may start raising rates as soon as next March.
Not so fast, says Bill Gross, who runs the giant PIMCO bond mutual fund shop. America is still seeing slow wage growth, and that's what's critical to keeping inflation in line. Without higher wages, there's less pressure on prices. "So the Fed is willing to stay put here," he said on Bloomberg radio.
ICAHN OUT; UP GOES STOCK: Shares in American Railcar gained 2 percent today, a day after Chairman Carl Icahn said he was leaving the board. The company said the departure was not the result of a disagreement. Icahn said he wants to reduce the number of boards on which he serves. Icahn has been chairman of the St. Charles-based railroad car maker since 1994.
LOCAL INDEX: The Bloomberg St. Louis Index rose 8 to 927.
STL STOCKS GAINERS LOSERS
Reliv 6.26% Allied Healthcare -6.14%
THE WEEK AHEAD: The usual quarterly earnings report extravaganza will get going in earnest later this month. Analysts at Dow Jones Indices are expecting a 11 percent earnings rise for the second quarter, compared to a year ago.
The week ahead looks rather calm in terms of economic news. On Tuesday, the Federal Reserve will report consumer credit. Analysts think consumers fell $19 billion deeper in hock in May, compared to $26.8 billion the previous month.
On Wednesday, the Fed will release the minutes from the June meeting of its Open Markets Committee, which may reveal more of the Fed's thinking on the economy and the likely course of interest rates.
Jim Gallagher is a reporter for the Post-Dispatch