Stock

Dow Rides Rally in defensive names shine on non-public jobs wobble

ยฉ Reuters.

By Yasin Ebrahim

Investing.com – The Dow jumped Wednesday as defensive market concerns such as utilities and consumer staples had a chance to shine amid data showing the US economy created fewer than expected private jobs last month.

The increase of 1.08% or 308 points, the increase of 1.17% and the gain of 0.74%.

In a sign that investors may be concerned that the surge in growth stocks like technology is nearing a spike, utilities were among the biggest winners, led by more than 3% gains in Exelon (NASDAQ ๐Ÿ™‚ and PPL (NYSE: )).

Consumer staples weren't far behind thanks to the Coca-Cola Company (NYSE ๐Ÿ™‚ gaining more than 4% and whiskey maker Brown Forman (NYSE ๐Ÿ™‚ gaining 9%.

Brown Forman reported first quarter earnings of 67 cents on sales of $ 753 million, beating estimates of 39 cents per share on sales of $ 691.2 million.

Technology lagged the general rise when Apple (NASDAQ ๐Ÿ™‚ was down 2%, though it's still up about 80% for the year to date. Apple stocks have been propped up by growing investor optimism about the upcoming launch of the iPhone 12, which many Wall Street analysts expect to see a wave of upgrades.

Energy continued its sluggish start to the week with falling oil prices despite data showing weekly inventories pulled more than expected 9.3 million barrels.

In economic terms, investors digested data showing the US economy created 428,000 private jobs in the past month, well below estimates of 950,000.

"ADP's move fell short of the official private payroll estimate in recent months, but the error narrowed sharply in both June and July. Assuming the gap continues to narrow in August, expect we that the official headline pressure on Friday is around 750,000, "said Pantheon Macroeconomics.

Still, the grim jobs report did little to cool expectations for a strong economic recovery at a time when consumer spending continues to pick up pace.

โ€œConsumer spending continued to rise, driven by strong vehicle sales and some improvements in the tourism and retail sectors, the Fed said in its Beige Book report.

In other news, Tesla (NASDAQ ๐Ÿ™‚ fell more than 6% after its largest outside shareholder, Baillie Gifford, cut some of its holdings in the company, citing portfolio constraints as the stock spiked.

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