Stocks Gain 2.3% for Week; Materials Lead

Stocks turned in their best performance since early January, up 2.3 percent for the week, as investors breathed a sigh of relief that job loss in February wasn't as bad as expected.

The Dow Jones Industrial Average gained over 1 percent in today's session, led by Alcoa and Boeing as commodity and industrial stocks got a boost from the jobs report, which showed 1,000 manufacturing jobs were added last month. American Express rounded out the Dow's top three today.

Just two components ended the day lower: Microsoft and Verizon.

The S&P 500 and Nasdaq each gained more than 1 percent today — and the Nasdaq hit an 18-month closing high — as Apple surged to an all-time high after the company set a date for the iPad to go on sale.

For the week, the Dow gained 2.3 percent. The S&P gained over 3 pecent and the Nasdaq jumped a whopping 4 percent.

Materials led gainers for the week, followed by consumer discretionary and financials.

Traders are increasingly making bets on consumer-discretionary stocks, not just playing defense with consumer staples.

Financials benefited from speculation that the Volcker rule, a crackdown on proprietary trading by banks, won't make it into any financial-reform law.

Commodities advanced this week: Oil finished at $81.50 a barrel, while gold ended at $1,135.20 an ounce.

The big event of the week came this morning: The February jobs report.

Employersslashed 36,000 jobs from nonfarm payrolls last month, far fewer than expected. The consensus estimate had projected a loss of 50,000 jobs but the whisper number went as high as 200,000, given the impact of brutal winter weather in the Northeast. Job losses for December and January were revised to show 35,000 fewer jobs lost than previously reported. And the unemployment rate held steady at 9.7 percent.

Manufacturing showed signs of a modest recovery, adding 1,000 jobs, but construction shed 64,000 jobs — a worrisome sign for the sector at this point in the recovery. Census hiring was just 15,000, less than expected.

Temporary work rose for a fifth straight month, which is usually viewed as an encouraging sign but Todd Schoenberger, managing director at LandColt Trading, said it's the source of some concern.

"After dissecting the report, traders are recognizing that what is keeping the jobs number from falling off a cliff is the amount of temporary hiring," Schoenberger explained. "Unless there is supporting evidence that temps are becoming permanent on company payrolls, the long-range view remains cloudy. This could dampen any bullish sentiment that appeared following the release," he said.

Now that the jobs report is out of the way, what sectors are traders focusing on for next week? Click on the video at left.

If the economy starts to wobble, the Fed may have to renew some of its stimulus measuresset to expire at the end of March, Bill Gross, of bond giant Pimco, said on CNBC this morning.

"These things have all been very critical but let's face it — they're expiring at the end of March," Gross said. "The critical do we really need Uncle Sam and the check writing to continue?"

Commodity stocks got a boost as the better-than-expected jobs report pushed both oil and gold higher.

Bank stocks were also higher, with Goldman Sachs and Citigroup up more than 2 percent. European bank stocks fared even better — UBS and Barclays were up more than 3 percent.

A little bit of drama in Europe this morning: Germany's economic minister Rainer Bruederle warned that the euro zone's largest economy "does not intend to give a cent" to Greece.

Despite all the drama, Greek stocks are actually up five out of the last six days. And Europe has generally outperformed the U.S. market this week — London's benchmark FTSE index is at a 52-week high.

And in China, Premier Wen Jiabao said the governmment would maintain an appropriately easy monetary stanceand active fiscal policy in his annual address to the congress.

AIG said in a regulatory filing that its insurance-like guarantees on over $100 billion of assets in European banks could remain on its books longer than the six monthsit had previously projected.

Traders are still working the tech trade. Large-cap techs did very well today.

Apple closed at an all-time high of $218.95 after the company said its iPad tablet would go on sale in the U.S. April 3 and international sales would start later in April.

And Google rose after Citigroup reiterated its "buy" rating on the stock. Dell was up over 1 percent, while Intel gained over 1 percent.

Rio Tinto and BHP Billiton advanced as they wage a battle to switch spot pricing for iron ore. The two companies could hold out for an 80 percent price increase if mills don't adopt indexing for the 2010-11 shipping year.

Toyota detailed further plans to deal with the problems that caused its widespread recalls. The company plans to set up a special team to boost road tests and review its research and development process, according to technology chief Takeshi Uchiyamada.

Volume remained light. Just 8 billion shares changed hands on the three major indexes. Advancers outpaced decliners on the Big Board, roughly 11 to 2.

On Tap for Next Week:

MONDAY: NABE conference; McDonald's Feb. sales; Fed's Warsh speaks; Earnings from H&R Block
TUESDAY: NABE conference; Anniversary of market's March lows; Fed's Evans speaks; 3-year Treasury auction
WEDNESDAY: Obama health-care speech; weekly mortgage apps; wholesale trade; state unemployment rates; Google hearing; weekly crude inventories; 10-year auction; earnings from American-Eagle Outfitters
THURSDAY: $2B California bond sale; international trade; weekly jobless claims; 30-year auction; earnings from Nat Semi, Aeropostale
FRIDAY: Gov'ts retail-sales report; consumer sentiment; business inventories; earnings from Ann Taylor

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