Roundup: U.S. stocks rally amid economic data, Fed minutes

U.S. stocks posed solid gains for the first week of 2017, with both the S&P 500 and the Nasdaq setting new closing records, as investors digested a batch of economic data and minutes from the U.S. Federal Reserve.

For the holiday-shortened week, all three major indices rallied to kick off 2017 trading, with the Dow, the S&P 500 and the Nasdaq going up 1.0 percent, 1.7 percent and 2.6 percent, respectively. U.S. stock markets were closed Monday for the New Year holiday.

The CBOE Volatility Index, often referred to as Wall Street's fear gauge, decreased 3 percent to end at 11.32 on Friday.

On the economic front, U.S. total nonfarm payroll employment rose by 156,000 in December, missing market consensus of 175,000, and the unemployment rate was little changed at 4.7 percent, the Labor Department announced Friday.

In December, average hourly earnings for all employees on private nonfarm payrolls increased 10 cents to 26.00 U.S. dollars, after edging down by 2 cents in November. Over the year, average hourly earnings have risen by 2.9 percent.

"Treasury yields are higher this morning on the combination of tepid job growth and faster-than-expected wage inflation. The two together suggest it is becoming more difficult to find employees," said Chris Low, chief economist at FTN Financial, in a note, Friday.

The U.S. Commerce Department reported that the goods and services deficit was 45.2 billion dollars in November, up 2.9 billion dollars from October's revised reading.

U.S. private sector employment increased by 153,000 jobs from November to December, missing market consensus of 172,000, according to the December ADP National Employment Report released Thursday.

In the week ending Dec. 31, the advance figure for seasonally adjusted initial jobless claims was 235,000, a decrease of 28,000 from the previous week's revised level.

The Non-Manufacturing Index, which measures activity in the U.S. service sector, registered 57.2 percent in December, beating market consensus slightly, according to the Institute for Supply Management (ISM) Thursday.

The December purchasing managers' index (PMI) registered 54.7 percent, an increase of 1.5 percentage points from the November reading and beating market consensus, said ISM in another report earlier this week.

"It is hard to imagine a better ISM manufacturing report to end 2016. The substantial rise in production and prices indicates strong current activity and the jump in new orders signals it should be maintained for the next several months," said Jay Morelock, an economist at FTN Financial.

Meanwhile, Wall Street also focused on minutes from the Fed's December meeting released earlier this week.

According to the minutes, policy makers agreed that information received over the intermeeting period indicated that the labor market had continued to strengthen and that economic activity had been expanding at a moderate pace since midyear.

"Most participants judged that a gradual pace of rate increases was likely to be appropriate to promote the Federal Open Market Committee's (FOMC) objectives of maximum employment and 2 percent inflation," said the minutes.

The Fed raised interest rates at its December meeting for just the second time in a decade and forecast three rate hikes for 2017.

In corporate news, shares of Macy's plummeted 13.90 percent to 30.86 U.S. dollars apiece Thursday after the U.S. department-store chain l announced plans to close 68 stores and lay off 10,000 employees in 2017.

Shares of General Motors Company surged 5.52 percent to 37.09 dollars apiece after the car-maker reported its best December sales since 2007. Endit