Thursday 4th October 2012
|Text too small?|
Wall Street advanced as reports on employment and services bettered expectations, leaving investors relieved that the world's largest economy is still expanding.
Private payrolls rose by 162,000 in September, according to the ADP National Employment Report. Investors opted to focus on the fact that the number surpassed forecasts. Still, it was below the 189,000 jobs added in August.
Separately, the Institute for Supply Management's non-manufacturing index advanced to 55.1 in September, from 53.7 in August. That surpassed the most optimistic forecast in a Bloomberg survey.
"It looks more like things are heading in the right direction. It is this new reality -- we don't have robust growth, we just have very moderate growth," William Larkin, fixed income portfolio manager at Cabot Money Management in Salem, Massachusetts, told Reuters.
In afternoon trading in New York, the Dow Jones Industrial Average gained 0.03 percent, the Standard & Poor's 500 rose 0.59 percent, while the Nasdaq Composite Index advanced 0.36 percent.
Shares of Hewlett-Packard slumped, last 11.1 percent weaker, after the company predicted profit for fiscal 2013 that fell short of expectations.
Investors are now focused on the September jobs report due on Friday. The jobless rate in the US probably rose to 8.2 percent last month from 8.1 percent in August, while payrolls increased by 115,000 in September, less than the 139,000 average over the first eight months of the year, economists polled by Bloomberg predicted.
The latest economic data from Europe showed that times remain challenging. Euro-zone services and manufacturing output shrank for an eighth month.
At a four-month low of 46.1 in September, little changed from 46.3 in August, the Markit Eurozone PMI Composite Output Index was slightly above its earlier flash estimate of 45.9. A bright spot came in retail sales, which advanced 0.1 percent in August from July, the European Union's statistics office said.
In Europe, the Stoxx 600 Index finished the session with 0.1 percent decline on the previous close. However, national benchmark stock indexes in the UK and Germany ended the day with gains of 0.3 percent and 0.2 percent respectively.
Meanwhile, the slowdown in the pace of growth of the world's No. 2 economy continues. China's purchasing managers' index dropped to 53.7 in September from 56.3 in August, according to the National Bureau of Statistics and China Federation of Logistics and Purchasing in Beijing.
The latest report out of China underpins hope the government will inject fresh stimulus to rekindle the pace of expansion.
It "increased the likelihood that the Chinese central bank or some other mechanism is focusing on providing liquidity to the economy," Thomas Sowanick, chief investment officer of Omnivest Group in Princeton, New Jersey, told Bloomberg.
No comments yet
AIA June 2020 Monthly Traffic Update and July 2020 Preview
PCT - Delivering on strategy underpins strong operating result
KFL - August 2020 monthly update
BRM - August 2020 monthly update
MLN - August 2020 monthly update
Further COVID-19 Restrictions at SkyCity’s New Zealand Properties
FY20 results guidance met, Results date, Banking Facility
Sky sells OSB assets to NEP NZ, secures 10 year partnership
NZX fully operational - announcement re COVID-19
Heartland Market Update