NEW YORK: The S&P 500 jumped to a fresh record on Friday after investors concluded that a disappointing August jobs report would discourage the US Federal Reserve from quickly raising interest rates.
The broad-based S&P 500 bolted 10.06 points (0.50 percent) higher to 2,007.71, besting a record set last week by about four points.
The Dow Jones Industrial Average rose 67.78 (0.40 percent) to 17,137.36, narrowly missing a record of its own, while the tech-rich Nasdaq Composite Index gained 20.61 (0.45 percent) to 4,582.90.
The Labor Department reported that the US economy added just 142,000 new jobs in August, snapping a six-month streak of more than 200,000 jobs per a month and coming in far below the 223,000 forecast by analysts.
But stocks rallied in the afternoon as investors saw the chances diminished that the Fed would accelerate its time table to raise benchmark interest rates.
"Investors are putting their expectation on when interest rates will rise a little later into the future," said David Levy, a portfolio manager at Kenjol Capital Management.
"Lower interest rates for a longer period of time are obviously viewed as a positive by investors."
Discount retailer Family Dollar fell 1.2 percent as it rejected a sweetened $9.8 billion bid from rival Dollar General (-2.3 percent) and reiterated its support for a $9.2 billion deal with Dollar Tree (+1.1 percent).
Dollar General, which has suggested it might launch a hostile attack to win the deal, said that it "remains committed to acquiring Family Dollar and is currently evaluating its next steps."
Dow component Merck rose 1.8 percent after the US Food and Drug Administration approved its pembrolizumab drug to treat metastatic melanoma.
Apparel retailer Gap dropped 4.2 percent as August comparable store sales fell two percent from last year.
Apparel maker and retailer Michael Kors Limited fell 4.5 percent to $76.39 as it announced the sale of a 5.7 percent stake held by Sportswear Holdings Limited. The offering will price at $76.75 per share.
Supermarket chain Kroger rose 1.1 percent on news that it will hire 20,000 employees as it pursues growth.
Bond prices fell. The yield on the 10-year US Treasury rose to 2.46 percent from 2.45 percent Thursday, while the 30-year advanced to 3.24 percent from 3.21 percent. Bond prices and yields move inversely.
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