Stocks Soar in Face of Jobs Report

Wall Street proved resilient Friday morning as the markets overcame the steepest one-month drop in payrolls since 1974 and looked ahead to a massive economic stimulus bill and a potential financial rescue plan. 

Today's Markets

As of 9:48 a.m. EDT, the Dow Jones Industrial Average rose 117.24 points, or 1.45%, to 8180.63, the S&P 500 jumped 12.00 points, or 1.42%, to 858.62 and the Nasdaq Composite picked up 26.22 points, or 1.70%, to 1572.46. The consumer-friendly FOX 50 added 10.39 points, or 1.66%, to 637.86

The positive start comes a day after the Dow jumped 106 points in the face of the looming jobs report, ending above the pivotal 8000 level. The benchmark index has straddled either side of the psychologically-important level ahead of a potential financial rescue plan being released on Monday. 

“We’ve seen this before. When the market can ignore what is clearly very negative economic news I think it’s a positive sign. The ability of the market to hold this Dow 8000 [level] is also something technically positive for investors to hold onto at the moment,” NYSE trader Ted Weisberg of Seaport Securities told FOX Business.

Underscoring the financial rescue hopes, Bank of America (BAC), Citigroup (C) and JPMorgan Chase (JPM) led the way up on the Dow in recent action. Non-financials like Caterpillar (CAT) and Alcoa (AA) also rose sharply. On the other hand, energy titans ExxonMobil (XOM) and Chevron (CVX) failed to join in the rally. 

The Nasdaq Composite rallied even further than the broader markets as tech stocks continue to outperform other sectors. Tech heavyweights like BlackBerry maker Research in Motion (RIMM) and eBay (EBAY) saw heavy buying. 

The markets were resilient even after the Labor Department said the U.S. lost 598,000 jobs in January, the largest one-month decline since December 1974. The nation's unemployment rate jumped to 7.6% last month, the highest level since September 1992. Both numbers exceeded economist forecasts but managed to be in line or better than what many on Wall Street were bracing for. 

“I think they thought it was going to come in a ton worse. It’s not a good number but the perception was it was going to be even worse. It’s the lesser of two evils,” said Stephen Carl, head trader at Williams Capital.

The January report came as no surprise as dozens of Fortune 500 companies announced mass layoffs last month, including 30,000 from now-bankrupt Circuit City and 20,000 from Caterpillar (CAT). More than 3.5 million jobs have disappeared over the past year alone, the steepest 12-month decline since government records began in 1939.

The brutal economic news likely bolsters the White House’s case for a massive stimulus package. The Senate is considering a stimulus bill that is quickly approaching $900 billion even as a group of moderate senators are racing to draft a less expensive alternative that relies more heavily on tax cuts. President Barack Obama has warned of an economic “catastrophe” if lawmakers fail to pass a robust stimulus package. A vote could come as early as Friday. 

“It’s going to be big and grand and probably very expensive but one way or the other it’s probably coming,” said Weisberg.

The markets can now shift their attention to Monday, when Treasury Secretary Timothy Geithner is expected to unveil the Obama administration’s financial-rescue plan. Speculation about what will be announced has alternated a number of times, from nationalization of the most troubled banks, to the creation of a “bad bank” to house companies’ toxic assets to insuring those assets against future losses.

Officials are now considering a plan that includes capital injections with tougher terms and an expansion of an existing Federal Reserve facility that could be used to buy the toxic assets dragging down banks’ balance sheets, The Wall Street Journal reported.

On the energy front, crude oil futures plunged below $40 per barrel a day after the commodity enjoyed its biggest one-day rally in nearly two weeks. The price of a barrel of crude was recently down $2.38 to $38.78.

Corporate Movers

Toyota (TM) warned it will likely post its first full-year loss since going public 59 years ago. The projected loss by Toyota underscores the freefalling auto sales market that has only been worsened by the credit crunch. 

Hartford Financial (HIG) lost one-fifth of its market value a day after the insurer posted a steeper-than-expected loss, slashed its dividend by 84% and lowered its regulatory capital estimates.

Biogen (BIIB) beat the Street with adjusted-earnings of 93 cents per share and posted roughly in-line revenue of $1.07 billion. The biotech giant said its Tysabri sales fell shy of estimates but it released a better-than-expected 2009 outlook.

General Electric's (GE) shares rose even after JPMorgan Chase (JPM) cut its price target on the conglomerate and said its dividend and coveted "AAA" credit rating are "unsustainable." 

Sharp warned it sees its first ever annual loss as the electronics maker swung to a quarterly loss, slashed its dividend by 25% and said it plans to cut 1,500 non-regular workers.

Ford (F) may need to inject $4 billion into its pension plan after a 2008 shortfall, potentially putting the only Detroit auto maker not yet bailed out by the government further into the red, Bloomberg News reported, citing a viability plan filed in December.

Nissan is considering seeking a low-interest loan of $556 million from the Japanese government, Japanese newspaper the Nikkei reported.

News Corp. (NWS) saw its shares rise a day after the media giant posted its largest quarterly loss ever on an $8.4 billion write down. The company, which is the parent of FOX Business and The Wall Street Journal, posted an adjusted-profit of 12 cents per share on $7.9 billion in revenue, missing estimates.

Sirius XM Radio (SIRI) is looking to raise $175 million by Feb. 17 to avoid bankruptcy and a potential takeover from EchoStar (SATS), which holds about $400 million of the satellite-radio company’s debt, the Journal reported.

Global Markets

European markets were in the green in recent action as the Dow Jones Euro Stoxx 50 index was up 0.57% to 2307.40 and London's FTSE 100 gained 0.76% to 4260.92.

In Asia, Japan's Nikkei 255 gained 1.6% to 8076.62 while Hong Kong's Hang Seng jumped 3.61% to 13655.04. Australia's ASX 200 index rose 1.2% overnight.