The US jobs market muddled along in January, with slower job growth and an uptick in unemployment, but underlying momentum was surprisingly stronger, official data showed Friday.
Employers added 157,000 jobs, down from December’s upwardly revised 196,000, the Labor Department said. The jobless rate rose to 7.9pc from 7.8pc, hovering at the same level since September. The disappointing January results — 180,000 jobs and a 7.7 pc jobless rate were expected—were offset by a sweeping annual revision of earlier data that revealed stronger jobs growth throughout last year despite worries about the looming year-end fiscal cliff.
That view propelled US stocks higher as investors took comfort in the idea that the Fed will have to keep its short-term interest rates near zero, keeping downward pressure on longer-term rates. The data helped propel the Dow Jones Industrial Average to above 14,000 for the first time since Oct 2007. At the closing bell, the blue-chip Dow was up 149.21 points (1.08pc) at 14,009.79. “The US stock market likes weak labor reports, and so the upward trend of stock prices remains intact. The reason is simple: weaker employment reports mean a longer period of time before the Federal Reserve changes its interest-rate policy,” said David Kotok of Cumberland Advisors.