While you were sleeping: Momentum builds
March 16 (BusinessDesk) - Equities in Europe and on Wall Street advanced on better-than-expected data on US manufacturing and a lower-than-forecast number of Americans applying for jobless benefits.
In early afternoon trading in New York, the Dow Jones Industrial Average gained 0.21 percent, the Standard & Poor's 500 Index advanced 0.45 percent and the Nasdaq Composite Index rose 0.17 percent. With the S&P 500 trading over 1,400, the benchmark has already surpassed the median 2012 estimate of strategists surveyed by Bloomberg.
"There is a built-in momentum trend as a result of the economic data," Peter Kenny, managing director at Knight Capital in Jersey City, New Jersey told Reuters.
The world's largest economy keeps producing data that better forecasts.
Applications for unemployment insurance payments fell by 14,000 to 351,000 in the period ended March 10, according to Labor Department figures. Economists had expected 357,000.
“There’s a steady, sustained improvement in the labour market,” Stephen Stanley, chief economist at Pierpont Securities in Stamford, Connecticut, told Bloomberg. “As more people have jobs, confidence is picking up. This is consistent with pretty solid gains in consumer spending."
Separate reports showed that manufacturing data in New York and the mid-Atlantic region improved, according to regional Federal Reserve surveys, while US producer prices, excluding food and energy, were contained. The core measure rose 0.2 percent, less than in the prior month.
Apple kept its upward momentum too. The stock climbed to a new record above US$600 in early trading.
In Europe, the Stoxx 600 Index closed with a 0.3 percent advance for the day.
The International Monetary Fund on Thursday approved a 28-billion euro bailout for Greece, part of a broader international rescue package, and would immediately provide 1.65 billion euros to help keep Athens afloat.
A sign of caution came from Fitch Ratings which said Britain risked losing its top investment grade because the economy might not be able to deal with shocks.
Oil was steady after dropping earlier in the session amid reports of a release of strategic oil reserves.
Britain has decided to cooperate with the US in a bilateral agreement to release strategic oil stocks, two British sources told Reuters, in an effort to prevent high fuel prices derailing economic growth in a US election year.
A formal request from the US to the UK to join forces in a release of oil from government-controlled reserves is expected "shortly" following a meeting on Wednesday in Washington between President Barack Obama and Prime Minister David Cameron, who discussed the issue, one source told Reuters. Britain would respond positively.
Jay Carney, the White House press secretary, said any reports of an agreement weren’t accurate, according to Bloomberg.
Crude oil for April delivery slipped 4 cents to US$105.39 a barrel at 1.33pm on the New York Mercantile Exchange.