U.S. stocks held at all-time highs as payrolls data supported speculation the economy is withstanding an overseas slowdown. Treasuries climbed with gold and the dollar slumped amid bets interest rates will stay low.
The Standard & Poor’s 500 Index rose less than 0.1 percent at 4 p.m. in New York, after closing at a record yesterday. The yield on 10-year Treasuries fell 8 basis points, the most in three weeks, to 2.31 percent. The Bloomberg Dollar Spot Index slid 0.6 percent. Emerging-market shares fell for a fifth day, and the Stoxx Europe 600 Index lost 0.5 percent. Gold futures climbed 2.4 percent, the most since June, and West Texas Intermediate jumped 0.9 percent, trimming a weekly decline.
Employment gains exceeded 200,000 for a ninth straight month in October and the jobless rate unexpectedly fell to a six-year low. Steadfast hiring signals employers are confident domestic demand will hold up in the face of struggling European and emerging economies.
“It is representing a continuing overall economic recovery in the face of considerable global headwinds,” said Christopher Sullivan, who oversees $2.3 billion as chief investment officer at United Nations Federal Credit Union in New York. “The economy is still on a favorable path, but it was not an exceptional report.”
Payrolls increased by 214,000 in October following a 256,000 advance the prior month that was more than initially estimated, Labor Department figures showed. The median forecast in a Bloomberg survey of 100 economists called for a 235,000 advance. The jobless rate declined to 5.8 percent, even as more people entered the labor force, boosting the share of the population working to the highest in five years.
Yields on 10-year notes fell for the first time in three days. U.S. policy makers ended the Fed’s third round of bond purchases under the quantitative-easing stimulus strategy on Oct. 29, citing a stronger economy. While the U.S. economy has gained, with gross domestic product expanding at an annualized 3.5 percent rate in the third quarter, inflation indicators have remained low.
“The Fed’s going to continue to walk the tightrope,” said Richard Schlanger, who helps invest $30 billion in fixed-income securities as vice president at Pioneer Investments in Boston. “The last thing they want to do is thwart any kind of growth we’re experiencing.”
The S&P 500 and Dow Jones Industrial Average extended all-time highs from yesterday. The benchmark index rose 0.7 percent this week, for a third straight weekly gain, after election results shifted control of the Senate from Democrats to Republicans, and the European Central Bank vowed to increase stimulus efforts if needed.
“We’re moving toward pause mode and a period of digestion following the rally of the past few weeks,” Terry Sandven, chief equity strategist at Minneapolis-based U.S. Bank Wealth Management, which oversees $120 billion, said by phone.
The S&P 500 has rebounded 9.1 percent from a six-month low on Oct. 15 as companies are beating analysts’ earnings estimates at the fastest pace in four years. Of the S&P 500 members that have reported their latest quarterly results, 80 percent topped profit projections, while 60 percent beat sales estimates, according to data compiled by Bloomberg.
Sears Holdings Corp. jumped 31 percent today after saying it’s exploring the sale and leaseback of 200 to 300 stores. Walt Disney Co. dropped 2.2 percent after saying profit at TV networks, its biggest division, fell, even as total earnings beat forecasts.
Health-care companies had the largest declines today. The U.S. Supreme Court agreed to consider a challenge to the subsidies that are a linchpin of President Barack Obama’s health-care overhaul, accepting a case that suddenly puts the law under a new legal cloud.
Health insurers, which have gained millions of new customers through the law, sank. UnitedHealth Group Inc., WellPoint Inc. and Aetna Inc. fell more than 2.7 percent. Hospitals, which must absorb costs when patients are uninsured, also dropped, with HCA Holdings Inc. and Tenet Healthcare Corp. sliding at least 4.6 percent.
The Stoxx 600 erased its weekly gain, dropping 0.5 percent for the week. Banking and technology shares led declines today. Societe Generale SA and UniCredit SpA dropped at least 2.4 percent.
Allianz SE, Europe’s biggest insurer, rallied 3.6 percent after earnings beat estimates. Swiss Re AG, the world’s second-biggest reinsurer, rose 2 percent.
The MSCI Emerging Markets Index fell 0.2 percent, extending its five-day slump to 2.7 percent.
The ruble trimmed its worst week since 2009 as the Russian central bank’s signal that it was ready to support the currency amid worsening tension in Ukraine’s east.
The currency gained 0.5 percent to 46.58 per dollar, after an advance of as much as 2.6 percent earlier in the day. New fighting in Ukraine and the slump in oil have weighed on the nation’s assets since the Bank of Russia abandoned its currency-intervention policy on Nov. 5.
Dozens of tanks and other military vehicles crossed the border into Ukraine from Russia, the government in Kiev said, as tensions between the former Soviet republics threatened to escalate into open war.
West Texas Intermediate rose 0.9 percent to $78.65 a barrel. Brent crude rose 0.6 percent to $83.39 a barrel, trimming this week’s decline to 2.9 percent. Brent dropped for a seventh straight week, the longest streak since 2001.
Oil has slumped into a bear market amid signs that global supply growth is outpacing consumption. The Organization of Petroleum Exporting Countries, which produces 40 percent of the world’s oil, cut every published forecast yesterday for demand for its crude through 2035, except for next year.
Gold advanced 2.4 percent to $1,169.80 an ounce.