The Dow Jones Industrial Average (INDU +0.56%) climbed above 17,000 for the first time Thursday as data showed employers added more workers than projected in June and the European Central Bank disclosed details of its stimulus plans.
Goldman Sachs Group Inc. and MetLife Inc. advanced at least 1.3%, pacing gains among banks and insurance companies.Paccar (PCAR +5.77%, news) Inc. added 2.4% amid speculation that the maker of Kenworth and Peterbilt trucks may receive takeover interest from Volkswagen AG. PetSmart (PETM +12.25%, news) Inc. jumped 12% after Jana Partners LLC disclosed a new activist stake. Lululemon Athletica Inc. gained 2.1% after a report that the yoga-wear company has explored a buyout by a private-equity firm.
Equities markets closed at 1 p.m. Thursday before the Independence Day holiday. The yield on 10-year Treasuries climbed two basis points to 2.65%.
“This is a pretty strong report,” said Jim Paulsen, chief investment strategist at San Francisco-based Wells Capital Management, in a phone interview. “This is stuff that is going to lead to upward revisions of second quarter growth rates and it starts off the third quarter in a real positive momentum place.”
The addition of 288,000 jobs followed a 224,000 gain the prior month that was bigger than previously estimated, Labor Department figures showed Thursday in Washington. The median forecast in a Bloomberg survey of economists called for a 215,000 advance. The jobless rate is the lowest since September 2008. The number of long-term unemployed fell to 3.1 million, showing they’re having greater success finding work.
It took the Dow 227 days to cross the 17,000 mark after surpassing 16,000 for the first time on Nov. 18. Caterpillar Inc., the world’s largest maker of construction and mining equipment, Walt Disney Co., the biggest entertainment company, and computer-chip maker Intel Corp., led the advance, rising more than 20%.
Benchmark indexes are at record levels as stocks extended a rebound from a selloff earlier this year that started with biotechnology and small-cap stocks. The S&P 500 has rallied 9.1% since reaching a two-month low in April as central bank stimulus spread from Europe to Japan and the U.S.
Fed Chair Janet Yellen said last month that accommodative monetary policy, rising property and equity prices and the improving global economy should lead to above-trend growth. The Fed has kept its benchmark rate near zero since December 2008.
Draghi gave some details Thursday on the new targeted-loan program that includes lending to banks under the condition they lend the money on to households and companies. He estimated that banks could take up as much as 1 trillion euros ($1.36 trillion) in the two initial tenders and a series of quarterly auctions.