Why the Dow Is Soaring Today

Blue-chip stocks are broadly higher today on the heels of better-than-expected jobs figures for the month of April. With roughly an hour left in the trading session, the Dow Jones Industrial Average (DJINDICES: ^DJI  ) is up by 145 points, or 0.98%.

The impetus for today's move was a report from the Department of Labor showing that domestic employers continued to add workers last month despite economic headwinds. According to the monthly release, payrolls increased by 165,000 in April, handily beating the consensus forecast of 135,000. The government also said the unemployment rate fell another tenth of a percent to 7.5%, the lowest level since December 2008.

Ford (NYSE: F  ) is among a number of companies that are currently hiring, reports Bloomberg News. Following another month of growing demand for its vehicles, the nation's second-largest automaker plans to add 2,000 positions at its plant in Claycomo, Mo., which assembles the popular F-150 pickup truck. In the month of April, the company saw its sales for all vehicles rise by 18% compared with the same month last year.

Unfortunately, not all of the economic news released today was as good as the jobs report. The Department of Commerce said (link opens PDF) this morning that new orders for manufactured goods fell by 4% in March. This followed a 1.9% increase in the preceding month and marked the second time in three months that the figure came in negative. Also out today was the ISM's nonmanufacturing index, which showed a weakening to 53.1% last month, down from 54.4% in March. According to the press release, "This indicates continued growth at a slightly slower rate in the non-manufacturing sector."

On the individual-company front, shares of Caterpillar (NYSE: CAT  ) are leading the Dow higher today, up by 3.5% at the time of writing. Given Caterpillar's bellwether status, its stock's rally seems tied to the generally positive sentiment today more than anything else. As my colleague Dan Caplinger noted earlier (speaking also of General Electric): "Both Caterpillar and GE need a marked improvement in global conditions to support their stock prices. Given the importance of the U.S. in the overall global economy -- especially on the consumer front, which is arguably most directly tied to employment conditions -- it's reasonable to conclude that better domestic jobs numbers will support economies worldwide."

Meanwhile, JPMorgan Chase (NYSE: JPM  ) is turning in one of the blue-chip index's worst performances this afternoon, down by 1.4%. The nation's largest bank by assets has struggled of late as industry regulators intensify their scrutiny of the institution. Most recently, as The Wall Street Journal has reported, the Federal Energy Regulatory Commission served JPMorgan with a Wells notice accusing the bank of overcharging certain states under electricity contracts. Over the next few weeks, moreover, CEO Jamie Dimon should learn whether or not shareholders will vote to strip him of his dual role as both chairman and CEO. For what it's worth, billionaire Warren Buffett said today that he "100% supports" Dimon's current status.

With big finance firms still trading at deep discounts to their historic norms, investors everywhere are wondering if this is the new normal or if finance stocks are a screaming buy today. The answer depends on the company, so to help you figure out whether JPMorgan is a buy today, check out The Motley Fool's premium research report on the company. Click here now for instant access!


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