After another solid monthly jobs report, technology companies again led the way as U.S. stocks rose for the fourth day in a row to start 2018. They are on their longest new-year winning streak in eight years.
Health care and consumer-focused companies also rose, and the weaker dollar gave industrial firms like Boeing and basic materials makers a lift.
Wages and worker productivity are rising at about the same rate, according to Ed Keon, managing director and portfolio manager of QMA, a fund manager owned by Prudential Financial. He said if that trend continues, company profits should stay solid and inflation won’t be much of a risk to the economy.
Productivity growth has been weak in recent years, but it jumped 3 percent in the third quarter. Keon said new technologies may now be helping businesses in a bigger way.
“It’s possible that we’re on the verge of a new productivity revolution,” he said. “If we are, that’s good news for wages, it’s good news for profits, it’s good news for economic growth, and it’s good news for the stock market.”
The Standard & Poor’s 500 index gained 0.7 percent, to 2,743.15, and rose 2.6 percent for the week. The Dow Jones industrial average added 220.74 points, or 0.9 percent, to 25,295.87. The Nasdaq composite rose 0.8 percent, to 7,136.56. The Russell 2000 index of smaller-company stocks rose 0.3 percent, to 1,560.01. — AP