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Stocks Close Higher As Wall Street Cheers Jobs Report, Nasdaq Clears Resistance

Stocks closed solidly higher Friday, after a good employment report set the tone for broad gains on Wall Street.

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The Nasdaq composite led with a 1.5% gain thanks to outperforming software, semiconductor and internet stocks. Some retail and energy groups also stood out with gains of 2% or more. The Nasdaq and Nasdaq 100 cleared nearly three-week consolidations.

The S&P 500 climbed 1.1%. The Dow Jones industrial average added 0.9%, with technology components Intel (INTC) and Microsoft (MSFT) hitting new highs. Small caps kept up, as the Russell 2000 rose 0.9%.

Friday’s gains solidified a weekly increase for the Nasdaq composite of 1.5%. The S&P 500 edged up for the week, but the Dow was down.

Volume Friday rose on the NYSE and fell on the Nasdaq, according to early data. Advancers led decliners by 12-to-5 on the NYSE and by more than 2-to-1 on the Nasdaq.

U.S. employers added 223,000 jobs in May while the unemployment rate fell to 3.8%. Economists expected 190,000 new jobs and 3.9% unemployment. Wage growth of 2.7% on an annual rate met views, easing worries of inflation higher and aggressive interest-rate hikes by the Fed.

Meanwhile, the U.S. and North Korea agreed to go ahead with a summit June 12 after a top North Korean official met with President Trump at the White House. Trump had canceled the meeting after angry remarks from both nations, which caused short-lived selling in U.S. markets. Stocks Friday had little reaction to the latest announcement.

VMware (VMW) broke out of a lopsided cup with handle base. Shares closed in buy range of the 145.25 buy point. The company beat profit and revenue for the April-ended quarter.

The left portion of the base was unusually sharp, with a 34% drop over two weeks. That’s a weakness for the chart, but shares have traded much more tightly in the past seven weeks.

IBD 50 Lags

The Innovator IBD 50 (FFTY) ETF rose 0.7%, lagging the main indexes a bit. The top performing stock was Momo (MOMO), which surged 8% and has reached a 20% profit goal from its 40.55 buy point. Momo soared 27% for the week after earnings beat expectations.

Viper Energy Partners (VNOM) plunged to its 50-day moving average, where shares started to rebound. The stock closed with a 7% loss in heavy trading. It was the largest loss and price move for the stock since July 2016. There was no news on Viper Energy on the wires.

Lodging was one of Friday’s best industry groups. Hyatt Hotels (H) broke out of flat base, topping an 83.12 buy point in average volume. In a related field, RLJ Lodging Trust (RLJ), a REIT that owns dozens of hotel properties, tried to break out past the 24.06 buy point of a cup base, but closed below the entry.

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