Last month I wrote about how ability and equity can be used as hedges against each other because when salaries go up the equity markets tend to go down and vice versa. Well today stocks hit a six-year high on news of a softening job market.

Stocks rallied sharply Friday as moderating job growth reinforced Wall Street's hopes that the Federal Reserve may soon end its series of interest rate hikes. The Dow Jones industrial average climbed more than 110 points to a fresh six-year high.

Investors saw a slowdown in April employment growth as the latest sign of a softening economy, a reason for the Fed to stop raising interest rates. That countered worries over rising wages, which followed an upswing in employers' labor costs on Thursday. ...

In late afternoon trading, the Dow climbed 134.63, or 1.18 percent, to 11,573.49, about 150 points away from its all-time high of 11,722.98, reached Jan. 14, 2000.

Broader stock indicators were higher. The Standard & Poor's 500 index was up 13.03, or 0.99 percent, at 1,325.28, its highest level since February 2001; the Nasdaq composite index advanced 18.17, or 0.78 percent, to 2,342.07.

Most people have jobs, but job-holders should diversify their portfolio and buy equity so that they can take advantage of both ends of the cycle.

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