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.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: PayPal Stops Processing Mega Payments; NZX Listing Still On

PayPal has ceased processing payments for Mega, the file storage and encryption firm looking to join the New Zealand stock market via a reverse listing of TRS Investments, amid claims it is not a legitimate cloud storage service. More>>

ALSO:

Housing Policy: Auckland Densification As Popular As Ebola, English Says

Finance Minister Bill English said calls by the Reserve Bank Governor for more densification in Auckland’s housing were “about as popular in parts of Auckland as Ebola” would be. More>>

ALSO:

Crown Accounts: NZ Government Deficit Smaller Than Expected In First Half

The New Zealand government's operating deficit was smaller than expected in the first six months of the financial year, as the consumption and corporate tax take rose ahead of forecast in December, having lagged estimates in previous months. More>>

ALSO:

Fruit & Veg Crackdown: Auckland Fruit Fly Find Under Investigation

The Ministry for Primary Industries (MPI) is investigating a find of a single male Queensland fruit fly in a surveillance trap in the Auckland suburb of Grey Lynn... MPI has placed legal controls on the movement of fruit and some vegetables outside of a defined circular area which extends 1.5km from where the fly was trapped in Grey Lynn. More>>

ALSO:

Scoop Business: Westpac NZ Reaches $2.97M Swaps Settlement

Westpac Banking Corp’s New Zealand unit has agreed to pay $2.97 million in a settlement with the Commerce Commission over the way the bank sold interest rate swaps to farmers between 2005 and 2012. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news