Stocks surge as Dow closes back above 20,000, Nasdaq hits record

NEW YORK -  Banks and other financial companies led stocks higher on Wall Street Friday as President Trump prepares to scale back financial industry regulations. Buyers were also encouraged by a pickup in hiring in January. Small-company stocks, which stand to benefit more than others from stronger economic growth, make sharp gains.

The Dow Jones industrial average jumped back above the 20,000 level as the blue-chip index rose 186.55 points, or 0.9%, to close at 20,071.46. The Standard & Poor's 500 index gained 16.57, or 0.7%, to 2297.43, moving within one point of its record closing high of 2298.37. The Nasdaq composite index added 30.57, or 0.5%, to set a new record closing high of 5666.77.

The Russell 2000 index of smaller-company stocks climbed 1.5% to 1,377.84. Smaller, domestically-focused companies may have more to gain than their larger peers from faster growth in the U.S. The Russell made large gains at the end of 2016 based on those hopes.

The stock market rally kicked off early after the government reported that U.S. employers added 227,000 jobs in January, higher than last year’s average monthly gain of 187,000 and a sign that President Donald Trump has inherited a robust job market. The unemployment rate ticked up to a low 4.8% from 4.7% in December, but for a good reason: More people started looking for work. The percentage of adults working or looking for jobs increased to its highest level since September.

January jobs report crushes expectations: 227,000 added

Financial firms rose after President Donald Trump took his first steps aimed at scaling back regulations on the industry. He signed an order that directs the Treasury Secretary to look for potential changes to the Dodd-Frank law, which reshaped financial regulations after the 2008-09 financial crisis and created the Consumer Financial Protection Bureau.

The order doesn’t have any immediate impact, but suggests Trump is intent on reducing regulations, which could boost profits for financial companies and banks.

Dow components Visa (V) and Goldman Sachs (GS) jumped 4.6%, JPMorgan Chase (JPM) added 3.1% and American Express (AXP) gained 2%. Smaller banks, which could find it easier to lend money if regulations are cut, also traded higher.

Trump to dismantle Dodd-Frank Wall Street rules through executive orders

Macy’s (M) stock soared after The Wall Street Journal  reported that Hudson’s Bay, the owner of Saks Fifth Avenue, could buy the department store chain. The companies declined to comment. Macy’s jumped 6.4%. The stock has been trading around five-year lows.

But online retail giant Amazon (AMZN)  traded lower as investors grew concerned about its sales. The company’s fourth-quarter sales fell short of analyst estimates and the company said it expects $33.25 billion to $33.75 billion in revenue in the current quarter. That’s more than $2 billion short of Wall Street estimates. The stock gave up 3.5%.

Benchmark U.S. crude added 29 cents to $53.83 a barrel in New York. Brent crude, used to price international oils, added 25 cents to $56.81 a barrel in London.

France’s CAC 40 jumped 0.7%. The British FTSE 100 rose 0.7% while Germany’s DAX added 0.2%. The Nikkei 225 in Tokyo finish almost unchanged and Seoul’s Kospi added 0.1%. The Hang Seng in Hong Kong shed 0.2%.