Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


While you were sleeping: Solid US jobs data

While you were sleeping: Solid US jobs data

July 4 (BusinessDesk) – Wall Street climbed to record highs, with the Dow closing above 17,000 for the first time, after a stronger-than-expected employment report bolstered optimism that the recovery in the world’s largest economy is on track.

In a trading session shortened ahead of the July 4th holiday, the Dow Jones Industrial Average rallied 0.54 percent, while the Standard & Poor’s 500 Index added 0.55 percent, and the Nasdaq Composite Index advanced 0.63 percent. Both the Dow and the S&P 500 finished at record closing highs. US markets are closed on Friday for Independence Day.

Gains in shares of Goldman Sachs and Caterpillar, up 1.5 percent and 1.4 percent respectively, led the increase in the Dow.

The US economy added 288,000 jobs in June, after a 224,000 increase in May that was bigger than previously estimated. The unemployment rate dropped to 6.1 percent, the lowest since September 2008.

“The report was very good and a real sign the economy is starting to take off," David Kelly, chief global strategist at JP Morgan Funds in New York, told Reuters. "That said, it isn't an unmixed positive for the market because it suggests the Fed will consider raising rates in the first quarter."

Indeed, US Treasuries fell, pushing yields on the two-year note three basis points higher to 0.51 percent, as an accelerating economy lowers the appeal of fixed-income assets and raises the spectre of an increase in interest rates.

In further evidence of US economic strength, a separate report showed the Institute for Supply Management’s non-manufacturing index was 56 in June, just below the 56.3 reading in May.

“The path to higher rates, which we expect in the near term, is going to remain a challenging one just because rates are going to remain low in Europe for a long time and our interest-rate differentials are already pretty wide,” William O’Donnell, head US government-bond strategist at Royal Bank of Scotland’s RBS Securities unit in Stamford, Connecticut, told Bloomberg News.

The European Central Bank kept its benchmark interest rate at 0.15 percent on Thursday, adding that it is unlikely to be raised any time soon as the euro-zone economy struggles to kick into higher gear.

“The key ECB interest rates will remain at present levels for an extended period of time in view of the current outlook for inflation,” ECB President Mario Draghi said at a press conference after the meeting. “The risks surrounding the economic outlook for the euro area remain on the downside.”

In Europe, the Stoxx 600 Index ended the day with a 0.9 percent increase from the previous close. The UK’s FTSE 100 advanced 0.7 percent, France’s CAC 40 gained 1 percent, while Germany’s DAX rose 1.2 percent.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Welcome Home: Record High Migration Stokes 41-Year High Population Growth

New Zealand annual net migration hit a new high in October as more people arrived from than departed for Australia for the first time in more than 20 years. More>>


Citizens' Advice Bureau: Report Shows Desperate Housing Situation Throughout NZ

CAB's in-depth analysis of over 2000 client enquiries about emergency accommodation shows vulnerable families, pregnant women and children living in cars and garages, even after seeking assistance from the Ministry of Social Development and Housing New Zealand. More>>


Speaking For The Bees: Greens Call For Neonicotinoid Pesticide Ban

The National Government should ban the use of controversial pesticides called neonicotinoids after evidence has revealed that even at low doses they cause harm to bee populations, the Green Party said today. More>>


Science Awards: NZAS Celebrate NZ Scientific Achievements

The Marsden Medal is awarded for a lifetime of outstanding service to the cause or profession of science, in recognition of service rendered to the cause or profession of science in the widest connotation of the phrase. This year’s medal is awarded to Dr Mike Andrews. More>>


Court Rules: Affco 'Unlawfully' Locked Out Meat Workers

The note says the full court found for the plaintiffs, "that is that the defendant locked out the second plaintiffs unlawfully and that it breached s 32 of the Act by acting otherwise than in good faith towards the plaintiffs while collective bargaining was still going on." More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news