NEW YORK (AP) - Investors finally got some good news on unemployment.
Major stock indexes jumped more than 1 percent Friday after the government's July jobs report showed employers cut fewer jobs last month and the unemployment rate unexpectedly dipped.
The Dow Jones industrial average rose 160 points following the Labor Department's announcement that companies shed 247,000 jobs in July, the fewest in a year. Economists had expected 320,000 lost jobs.
The report is often the most anticipated piece of economic news each month on Wall Street so the surprise figures provided a strong propellent for stocks. Still, analysts said the latest reading didn't tell investors anything really new; it did let them know they've been justified in sending stocks sharply higher during the past month.
Investors have been betting that the economy is slowly digging out of the recession. Unemployment might take a long time to recover but it would be hard, if not impossible, for the economy to strengthen if it was getting worse.
Instead, the unemployment rate dropped to 9.4 percent from 9.5 percent in June. Economists forecast the rate would rise to 9.6 percent.
"It's a pretty good jobs number, (and) certainly trending in the right direction," said James Shelton, chief investment office at Kanaly Trust in Houston. "It's not necessarily pointing to growth yet," he added, but it shows deterioration in the economy is lessening...........
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