Stocks rise after gov’t says employers added 162,000 jobs; home, service activity improve

Stocks rise after upbeat jobs report

NEW YORK — Stocks rose Monday after an increase in hiring raised expectations for the economy.

The Dow Jones industrial average rose 50 points in morning trading and neared the psychological benchmark of 11,000 for the first time in 18 months.

The Labor Department said Friday that employers added 162,000 jobs in March. It was the biggest gains since the recession began in December 2007. However, the number was fewer than the 190,000 jobs economists forecast. The stock market was closed Friday so investors didn’t have a chance to trade on the report before the weekend.

Stocks are also rising following an improvement in pending home sales and an increase in activity in U.S. services industries.

The National Association of Realtors said its seasonally adjusted index of sales agreements rose 8.2 percent in February from January.

Meanwhile, the Institute for Supply Management, a trade group, said that the nation’s service industry rose in March to 55.4 from 53 in February. Economists had forecast a reading of 54. The growth in the service index is the fastest since ISM revised how it measured the industry in January 2008.

The jobs report added to expectations that the economy is making strides. Private employers accounted for most of the gains. Temporary government hiring for the 2010 U.S. census did not pad the figures as much as economists had forecast, which helped keep the figure below expectations.

The unemployment rate remained at 9.7 percent for the third straight month.

High unemployment is considered a key stumbling block to a sustained recovery because it keeps consumers from spending and loan defaults elevated. The financial sector would get a big boost from a drop in loan losses, while consumer spending accounts for the majority of economic activity in the country.

In midmorning trading, the Dow rose 51.09, or 0.5 percent, to 10,978.16. The Dow hasn’t traded above 11,000 since Sept. 29, 2008.

The broader Standard & Poor’s 500 index rose 6.42, or 0.5 percent, to 1,184.52. The Nasdaq composite index rose 18.82, or 0.8 percent, to 2,421.40.