U.S. payrolls grew by 4.8 million in June, the Labor Department said Thursday, New York Times reports.
It was the second month of gains after a loss of more than 20 million in April, when the pandemic put a large swath of economic activity on ice.
The unemployment rate fell to 11.1 percent, down from a peak of 14.7 percent in April but still higher than in any previous period since World War II. The rate would have been about one percentage point higher had it not been for persistent data-collection problems, the Labor Department said.
Stocks rose on Thursday as investors cheered a bigger-than-expected increase in jobs in June as the economy tries to claws back from the coronavirus shutdown.
The Dow Jones Industrial Average traded 269 points higher, or 1.1%. The Nasdaq Composite hit a record high, climbing more than 1%. The S&P 500 gained 1.1%.
The major averages, however, cut their gains after Reuters reported a one-day spike of more than 10,000 coronavirus cases in Florida.
Boeing contributed to the gains, rising more than 1% after the airplane maker completed recertification flights for its grounded 737 Max jet, according to a CNBC report.
Stocks that would benefit from an economic reopening also rose. Cruise operators Carnival, Norwegian Cruise Line and Royal Caribbean all gained at least 0.5%. United Airlines and Delta each traded more than 0.6% higher. American Airlines and Southwest advanced 1.1% and 1.6%, respectively.
The government’s June jobs report showed 4.8 million jobs were created. Economists were expecting 2.9 million jobs were created. The unemployment rate fell to 11.1% from 13.3% in May. Economists were expecting a rate of 12.4%, according to Dow Jones.
Last month, economists forecast a loss of 8 million jobs in May and the economy gained 2.5 million payrolls instead.
“The direction of the economy is certainly north,” Jim Paulsen, chief investment strategist at the Leuthold Group, said on CNBC’s “Squawk Box” following the report. “I think that’s all it has to do to continue to provide confidence, not only to investors, but also to companies and to consumers.”
Meanwhile, weekly jobless claims data was released Thursday morning.
The Labor Department said Thursday that initial jobless claims rose by 1.427 million in the week ending June 27. Economists polled by Dow Jones expected initial U.S. jobless claims to rise by another 1.38 million, down from 1.48 million the week earlier.
The data also showed the number of continuing claims — the number of people receiving unemployment benefits for consecutive weeks — rose to 19.29 million, an increase of about 59,000.
The moves Thursday followed the market’s first trading day in the third quarter. Both the S&P 500 and Nasdaq Composite gained during the regular session on Wednesday, with the latter jumping more than 1% to an all-time high.
U.S. markets will be closed on Friday for the July Fourth holiday.
SOURCES: . Bureau of Labor Statistics