US STOCKS-Wall Street buoyed by U.S. jobs growth despite tariffs

NEW YORK (Reuters) – The S&P 500 and the Nasdaq rose to their highest levels in two weeks on Friday as strong U.S. jobs growth blunted the impact of an escalating U.S.-China trade dispute.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., July 6, 2018. REUTERS/Brendan McDermid

Nonfarm payrolls increased by 213,000 jobs last month, the U.S. Labor Department said, topping expectations of 195,000, while the unemployment rate rose from an 18-year low to 4 percent and average hourly earnings rose 0.2 percent. The moderate wage growth allayed fears of a strong build-up in inflation pressures.

The positive news from the U.S. employment report offset, at least for the moment, heightened trade tensions between the United States and China. The two countries slapped tit-for-tat tariffs on $34 billion worth of each other’s imports on Friday. Beijing accused the White House of triggering the “largest-scale trade war.”

U.S. stock futures traded downward on Friday morning after the tariffs went into effect but reversed course after the release of the jobs report. By the market open, stocks were rising.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., July 6, 2018. REUTERS/Brendan McDermid

“The market turned its frown upside down, and it’s been in the green ever since,” said Kim Forrest, senior portfolio manager at Fort Pitt Capital Group in Pittsburgh. “This really is the best outcome we could have hoped for, more jobs without a whole lot of wage pressures.”

The Dow Jones Industrial Average rose 133.24 points, or 0.55 percent, to 24,489.98, the S&P 500 gained 25.88 points, or 0.95 percent, to 2,762.49 and the Nasdaq Composite added 101.94 points, or 1.34 percent, to 7,688.37.

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