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Dow Jones Jumps 300 Points, Nears All-Time High; Caterpillar Breaks Out

The Dow Jones and other major stock indexes ended the week with a bang Friday, helped by a better-than-expected October jobs report. The stock market strengthened just after 10 a.m. Eastern even after the ISM manufacturing index came in below expectations and showed contraction again.

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A high-profile acquisition made headlines Friday when Google parent Alphabet (GOOGL) announced plans to buy Fitbit (FIT) for $2.1 billion. The deal values Fitbit at $7.35 a share. Fitbit shares surged 31% Monday on news of a potential deal. Shares jumped another 15.5% Friday to 7.14.

The Dow Jones added 1.1%, stopping just short of an all-time high. The S&P 500 and Nasdaq composite scored all-time highs with gains of 1% and 1.1%, respectively. Preliminary data showed volume on the NYSE and Nasdaq coming in close to Thursday's levels.

The economy created 128,000 jobs in October, above the consensus estimate for 90,000. The unemployment rate edged higher to 3.6%. But the ISM manufacturing index showed contraction again with a reading of 48.3, below the consensus estimate of 49.3.

Dow Jones Movers

Caterpillar (CAT) topped a 140.72 buy point, rising nearly 5% to 144.49. The stock has continued to rally after its Oct. 23 earnings report.

Exxon Mobil (XOM) also outperformed in the Dow Jones, rising 3%, after the company reported strong earnings. But the stock is still on a downtrend.

Earnings News

Friday's session yielded several more earnings winners, including chipmaker Qorvo (QRVO). It gapped out of a long consolidation that started more than a year ago. Chip stocks outperformed as VanEck Vectors Semiconductor ETF (SMH) jumped to a new high, rising 2%.

Fortinet (FTNT) also gapped up powerfully on earnings. Shares jumped 10.5% to 90.13 as it approaches a 92.89 buy point. The security software group is now about 14% off its high, but one other stock deserves mention in the group because of its resilience. Nice (NICE) is holding gains after a breakout this week over a 155.86 entry.

Bruker (BRKR) closed off highs but still jumped nearly 13% to 50.10. The health care name also gapped up after reporting its third straight quarter of accelerating sales growth

Inside The IBD 50

MasTec (MTZ), an infrastructure construction company, was volatile after falling 2.6% intraday on earnings. But the stock vaulted back above its 50-day moving average, rising nearly 9% to 68.46.

But Innovator IBD 50 ETF (FFTY) could only manage a gain of 0.4%, weighed down by weakness in Arista Networks (ANET).

Follow Ken Shreve on Twitter @IBD_KShreve for more stock market analysis and insight.

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