304,000 new jobs, nearly double what was expected, were created in January and thus pushed the Dow up nearly 200 points in the a.m. session.  Unemployment also rose to 4 percent but this was mainly due to the job market improving so much that those who had long since dropped out were now back in wanting to go back to work.  This 6-digit job increase went along with a report of increased manufacturing activity pointing to continued underlying strength in the economy.  But then things started going south when Amazon disappointed and this sent the heavyweight down and the entire retail sector with it.  At close, the Dow had lost all but 64 points of the gains.  China also reported that its manufacturing shrank for the second consecutive month.  Volume continued heavy at 7.5 billion. 

fri  FEBRUARY 1, 2019 / 4:31 pm 

Amazon jitters offset upbeat jobs data on Wall Street

Noel Randewich

DJ:  25,063.89  +64.22      NAS:  7,263.87  -17.87        S&P:  2,706.53  +2.43       2/1

(Reuters) - Wall Street ended mixed on Friday, as optimism from a surge in January U.S. job growth was offset by a weaker-than-expected outlook from Amazon.com Inc that battered retail stocks.  The online retail heavyweight slumped 5.38 percent after its quarterly sales forecast fell short of Wall Street estimates, overshadowing its record sales and profit during the holiday season.  Those results put the Nasdaq in negative territory, while retailers Walmart Inc, Macy’s Inc and Kohl’s Corp each dropped more than 2 percent. The S&P consumer discretionary index fell 1.77 percent.

A U.S. Labor Department report showed nonfarm payrolls jumped by 304,000 jobs last month, the largest gain since February 2018 and beating economists’ expectations for an increase of 165,000.  That report, along with better-than-expected ISM manufacturing activity numbers for January, pointed to underlying strength in the economy despite an uncertain outlook that has left the Federal Reserve wary about more U.S. interest rate hikes this year.  “What the unemployment report is telling you is that people want to go back to work,” said Tom Martin, senior portfolio manager at GlobAlt Investments in Atlanta. “The consumer needs to be strong, and if the consumer is employed, the consumer will stay strong.”

Even as the U.S. economy remains on a stable footing, investors are concerned that a slowdown overseas could hurt profit growth, with high-profile companies such as Apple Inc warning of slower demand in China.  Data showed China’s manufacturing sector shrank in January for the second straight month, heightening risks for global growth amid a trade war with United States.

The Dow Jones Industrial Average climbed 64.22 to end the week at 25,063.89 points, while the S&P 500 edged 2.43 higher to 2,706.53.  The Nasdaq Composite dropped 17.87 to 7,263.87.  The S&P 500 rose 1.6 percent for the week and the benchmark index is up 8 percent so far in 2019, but it still remains 8 percent below its record high close on Sept. 20, 2018.  The Dow added 1.3 percent for the week and the Nasdaq gained 1.4 percent.

During Friday’s session, Exxon Mobil Corp and Chevron Corp jumped more than 3 percent apiece after the oil majors reported better-than-expected quarterly profits, boosting the Dow Jones Industrials.  The S&P energy index rallied 1.83 percent, also helped by higher oil prices.  Cigna Corp slid 2.88 percent lower after the health insurer forecast 2019 revenue and earnings below estimates.

Advancing issues outnumbered declining ones on the NYSE by a 1.30-to-1 ratio; on Nasdaq, a 1.37-to-1 ratio favored advancers.  The S&P 500 posted 29 new 52-week highs and no new lows; the Nasdaq Composite recorded 51 new highs and 20 new lows.

Volume on U.S. exchanges was 7.5 billion shares, compared with the 7.7 billion share average over the last 20 trading days.