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

 

What Winter? Temperature Records Set For June 20-22

The days around the winter soltice produced a number of notably warm tempertaures. More>>

Conservation Deal: New Kākāpō Recovery Partnership Welcomed

Conservation Minister Maggie Barry says the new kakapo recovery partnership between DOC and Meridian Energy is great news for efforts to save one of New Zealand’s most beloved birds. More>>

ALSO:

Tech Sector Report: Joyce Warns Asian Tech Investors View NZ As Hobbits And Food

Speaking in Wellington at the launch of a report showcasing the value of the technology sector to the New Zealand economy, Joyce said more had to be done to tell the country's technology stories overseas. More>>

ALSO:

Mediaglommeration: APN Gets OIO Approval For Demerger Plan

APN News & Media has received Overseas Investment Office approval for its plan to split out its NZME unit ahead of a potential merger with rival Fairfax Media's New Zealand operations. More>>

New Paper: Ninety-Day Trial Period Has No Impact On Firms' Hiring

The introduction of a 90-day trial period has had no impact on hiring by New Zealand companies although they are now in widespread use, according to researchers at Motu Economic and Public Policy Research. More>>

ALSO:

Corrections: Serco Exits Equity Stake, Remains As Operator

Serco has sold its equity stake in the company that holds the contract to design, build and run Wiri Prison in South Auckland but continues as sub-contractor to operate the facility. More>>

GDP: NZ Economy Grows Faster-Than-Forecast 0.7%

New Zealand's economy grew at a faster pace than expected in the first quarter of 2016 as construction expanded at the quickest rate in two years. The kiwi dollar jumped after the data was released. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news