Stocks rise in early trade

Wall Street gains following a massive two-session selloff, despite Ford's quarterly loss and worse-than-expected jobs report.

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By CNNMoney.com staff

What should be President-elect Obama's first economic priority?
  • Creating jobs
  • Solving the Wall St. crisis
  • Cutting taxes
  • Reducing spending

NEW YORK(CNNMoney.com) -- Wall Street climbed Friday morning as investors used the Dow's massive slide over the last two sessions as a reason to get back into stocks, despite a brutal October jobs report.

The Dow Jones industrial average (INDU), the Standard & Poor's 500 (SPX) index and the Nasdaq composite (COMP) all gained in the early going.

Stocks have plummeted in the sessions since President-elect Barack Obama's historic victory, with investors cashing out after a sharp rally in the week leading up to Election Day.

In two sessions, the Dow lost 929 points, its biggest two-day decline ever, according to Dow Jones. The percentage decline was 9.7% and its worst two-day drop since October 1987.

Following that steep selloff, investors were willing to dip back into a variety of shares Friday, despite the latest indications of a recession.

The Labor Department reported that the United States lost 240,000 jobs in October, meaning the U.S. has shed nearly 1.2 million jobs so far this year. The unemployment rate hit 6.5%, its highest level since 1994.

Both figures topped expectations. A consensus of economists had projected 200,000 lost jobs for October, and an employment rate of 6.3%, according to Briefing.com. Through September, the unemployment rate was 6.1%.

"The market yesterday anticipated an ugly [jobs report] number today, so it's really baked into the market," said Peter Cardillo, analyst for Avalon Partners, before the jobs report was announced.

The bleeding job market is one of President-elect Barack Obama's top challenges when he moves into the White House in January.

Companies: Ford Motor (F, Fortune 500) reported a $3 billion operating loss for the third quarter and said it would reduce staff to cut costs. Shares gained 3% in morning trading.

General Motors (GM, Fortune 500) is due to report quarterly results shortly, with big losses expected. According to a survey of economists from Thomson Reuters, GM is expected to report a 9% drop in revenue to less than $40 billion and a loss of $2.90.

Detroit's Big Three automakers have been pushing for a bailout on Capitol Hill.

After the close of trading, the auction house Sotheby's (BID) is also expected to report earnings.

Economy: In addition to the jobs report, a slew of reports are on tap. A reading on pending home sales is due at 11:30 a.m. ET. At 10 a.m. ET, the Commerce Department will release its report on wholesale inventories. At 3 p.m. ET, the Federal Reserve will release its report on consumer credit, a measure of consumer debt.

World markets: Asian shares ended mixed, with Hong Kong's Hang Seng gaining more than 3% and Japan's Nikkei index losing 3.5%. European stocks were mostly higher in morning trading.

Oil and money: Oil prices were flat, edging up 40 cents to $61.17 a barrel in electronic trading. The dollar fell versus major international currencies, including the euro, the yen and the British pound.

Did you vote for Obama? How do you think the new president will affect your wallet? What do you think Obama needs to do to fix the economy - both in the short run and the long term? What should be first on the new Congress's agenda? E-mail us your thoughts, including your name, photo and contact info; the best answers will be featured in an upcoming CNNMoney.com article.  To top of page

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