A surge in hiring in June pleasantly surprised investors in a shortened trading session on Thursday. The positive news sent all of the markets higher and helped the Dow pass 17,000 for the first time.
The Dow gained 92 points, with 27 of its 30 components gaining ground; the S&P 500 Index rose 10; and the Nasdaq was higher by 28. Advancers led decliners by four to three on the NYSE and two to one on the Nasdaq. The prices of Treasuries weakened. Gold futures fell $10.30 to close at $1,320.60 an ounce, and the price of crude oil was down 42 cents to settle at $104.06 a barrel.
For the holiday-shortened week, the Dow and the S&P 500 Index rose 1% and the Nasdaq added 2%.
In Other Business News:
- Today’s better-than-expected employment data was an encouraging sign for the economy. Nonfarm payrolls increased by 288,000, the fifth-straight increase of 200,000 or more. The economy hasn’t seen a string of numbers like that since 1999. The unemployment rate dropped to 6.1%, the lowest rate since 2008. Read Dr. Brian Jacobsen’s analysis of the data and what it may mean for the Federal Reserve.
- The Institute for Supply Management’s services index, which covers businesses that account for 90% of the U.S. workforce, slid slightly to 56 in June. Any reading higher than 50 signals expansion.
- The U.S. trade deficit fell by 5.6% in May, according to the Commerce Department. Imports were down 0.3%, and exports climbed 1.0% due to increased shipments of cars, petroleum, and fish. A smaller trade gap tends to be more beneficial for a country’s economy.
- The European Central Bank announced that it would keep interest rates unchanged but stated it could still use “unconventional measures” if inflation continues to stay low. The ECB also said that it was changing its meeting schedule next year to once every six weeks (instead of four) and that it would release minutes for each meeting, a process similar to the Federal Reserve.
- Struggling yoga-gear maker lululemon athletica’s founder Dennis “Chip” Wilson is looking into taking the company private as he continues to disagree with the company’s board on the lululemon’s strategic direction. The stock (LULU) climbed 2%.
- PetSmart revealed that a hedge fund run by an activist investor has acquired 9.9% of the company and that there will be future discussions about strategies to increase shareholder value, which may include selling the company. PetSmart’s shares (PETM) jumped 12%.
Most of the mistakes we make every day have fairly limited consequences. But now and again, even the simplest mistake has a big impact. Take these examples:
- If you’ve ever been exposed to computer code, you know it’s pretty unforgiving. No one knows this better than the scientists at NASA. Back in 1962, NASA was ready to launch the Mariner I, which was to fly past Venus, setting the standard for space travel at the time. But five minutes after launch, the $80 million rocket blew up due to a missing hyphen. In 2014 terms, that was a $630 million mistake and a major facepalm. After learning that, I don’t know that I’ll get quite as frustrated when a missing semicolon blows up my website code. Not really that big of a deal in the scheme of things (unless I’m working for NASA, but I don’t see that happening).
- Not all mistakes have negative consequences. Alexander Fleming may have been a brilliant scientist, but he was pretty sloppy—and his dirty petri dishes led to the discovery of penicillin and a much healthier society. (I’m hesitant to tell this story to my kids. I’m afraid they’ll use it against me the next time I’m yelling at them to clean their rooms. “But mom! I’m working on the next great scientific discovery!”)
- Finally, there’s the history of the holiday we’re celebrating this weekend. Technically, the Continental Congress unanimously voted for U.S. independence on July 2. Future President John Adams predicted the day would be “the most memorable epocha in the history of America” and celebrated “from this Time forward forever more.” However, even though Congress voted on the second, the Declaration of Independence was completed and sent to the printer on July 4, and the printer printed that date at the top of the document. By the time Congress realized the mistake the following year, it was too late. Even though he had the date wrong, John Adams did accurately predict how many of us will spend the Fourth: with parades, shows, games, and fireworks. He only forgot the hot dogs.
Have a safe and fun Fourth of July weekend (and if you’re in the path of Hurricane Arthur, take care). We’ll see you again on Monday!