NEW YORK (AP) — U.S. stocks are jumping Friday morning as a strong July jobs report gave investors more confidence that the economy is still growing. The Labor Department said employers added 255,000 jobs, far more than experts had expected. Bank stocks rose on the prospect of higher interest rates and consumer companies rose as investors hope consumers will have more money to spend.
KEEPING SCORE: The Dow Jones industrial average surged 142 points, or 0.8 percent, to 18,493. The Standard & Poor’s 500 index rose 14 points, or 0.7 percent, to 2,178. The Nasdaq composite gained 52 points, or 1 percent, to 5,217. The Dow and the S&P 500 are now higher for the week, while the Nasdaq extended its gains.
JOBS RELIEF: The strong jobs report follows an even larger gain in June. It suggests that Britain’s vote to leave the European Union in late June didn’t have much effect on hiring plans. Companies also kept hiring in spite of weak job growth in the first half of this year, including disappointing job gains in April and May. The Labor Department said the unemployment rate remained at 4.9 percent and hourly pay continued to rise. It’s up 2.6 percent over the last 12 months, matching the fastest pace since the recession.
EYES ON THE FED: The Federal Reserve has been saying for months that it intends to raise interest rates if the economy is strong enough to warrant it. July’s report provides more evidence the economy is doing well, making a boost in interest rates more likely. Banks rose the most Friday morning, as higher interest rates boost their profits on lending. Bank of America rose 47 cents, or 3.3 percent, to $14.96 and Citigroup added $1.36, or 3.1 percent, to $45.20.
CONSUMER COMPANIES CLIMB: Online booking service Priceline posted a bigger profit than expected and its stock rose $66.42, or 4.9 percent, to $1,426.41. That was the biggest gain among consumer companies, but it was far from alone. Home Depot also added $1.04 to $137.12 and Nike gained 99 cents, or 1.8 percent, to $55.78.
FUNKY CHICKEN: Tex-Mex food chain El Pollo Loco jumped $1.03, or 7.9 percent, to $14.11 after its results were stronger than analysts expected.
A TASTE FOR KRAFT: Kraft Heinz, the company behind Oscar Mayer bologna, Jell-O pudding and Velveeta cheese, also traded higher after it reported a larger profit than analysts expected. Its stock picked up $4.31, or 5 percent, to $89.85.
SECURITY: Security software maker FireEye tumbled after it reported weak sales, cut its estimates for billings and revenue, and said it will eliminate 300 to 400 jobs to reduce costs. Its stock plunged $2.16, or 12.9 percent, to $14.59. Security software rival Symantec disclosed a larger profit and better sales than expected in its fiscal first quarter, and its full-year profit forecast was stronger than expected. Its stock climbed $1.23, or 5.8 percent, to $22.26.
LUNG CANCER TREATMENTS: Bristol-Myers Squibb stock sank $12.48, or 16.6 percent, to $62.83 after the company said its drug Opdivo did not halt progression of non-small cell lung cancer in a clinical study. Opdivo is used to treat several types of cancer and Bristol-Myers brought in $1.5 billion in revenue from the drug in the first half of this year, but the company has continued running studies in the hope of winning new marketing approvals. In the latest study, Bristol-Myers tested Opdivo on a group of patients who hadn’t previously been treated for advanced cancer.
The failure of the trial gave a big boost to other companies who might benefit from higher sales for their own drugs. Merck, which has reported $533 million from its cancer treatment Keytruda this year, rose $4.31, or 7.5 percent, to $62.14. AstraZeneca, which is also studying a lung cancer drug regimen, added 34 cents, or 1 percent, to $34.64.
BONDS AND CURRENCIES: Bond prices fell and the yield on the 10-year U.S. Treasury note rose to 1.56 percent from 1.50 percent. The dollar rose to 101.86 yen from 101.17 yen and the euro fell to $1.1060 from $1.1127.
ENERGY: Benchmark U.S. crude slid 57 cents, or 1.4 percent, to $41.36 per barrel in New York while Brent crude, used to price international oils, lost 49 cents, or 1.1 percent, to $43.80 a barrel in London.
OVERSEAS: France’s CAC-40 rose 1.5 percent and the DAX in Germany advanced 1.2 percent. London’s FTSE 100 was 0.8 percent higher. The Shanghai Composite Index shed 0.2 percent and Tokyo’s Nikkei 225 was unchanged. In South Korea, the Kospi rose 0.9 percent.
AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP . His work can be found at http://bigstory.ap.org/journalist/marley-jay