Friday, 08 May, 2015
Stocks jump on strong April jobs report, Conservative win in UK election
(Associated Press) — NEW YORK — U.S. stocks jumped in midday trading Friday, helped by a report that showed employers were still hiring workers at a steady pace. Foreign markets were also rising following the results of the election in the United Kingdom, where the David Cameron’s Conservative Party won an outright majority in Parliament. KEEPING SCORE: The Dow Jones industrial average rose 280 points, or 1.6 per cent, to 18,203 as of 12:05 p.m. Eastern. The Standard & Poor’s 500 index added 29 points, or 1.4 per cent, to 2,117 and the Nasdaq composite rose 66 points, or 1.4 per cent, to 5,012. JOBS, JOBS, JOBS: Investors cheered a report that showed U.S. employers added 223,000 jobs in April, a solid gain that suggests that the economy may be recovering after a stumbling start to the year. The unemployment rate fell to 5.4 per cent from 5.5 per cent in March, the lowest rate since May 2008. While the jobs report is always closely watched, April’s survey garnered even more interest than usual. The March jobs figures were abysmal, with employers creating only 85,000 jobs that month. “I am even more convinced that the March report was an outlier,” Paul Christopher, an investment strategist with Wells Fargo Advisors. “We all know the first quarter was a tough quarter. The jobs numbers needed to hold up and they did.” MORE VOLATILITY: The bond market continued its week of heightened volatility. The 10-year Treasury note traded at a yield of 2.12 per cent, down from 2.18 per cent the day before. Bond traders said the rally was tied to rising expectations that the Federal Reserve will likely keep interest rates at zero for the rest of year. U.K. ELECTION: The Conservative Party surged to get a majority lead in Britain’s parliamentary election, meaning Cameron will remain in power. The clarity of the result eased concerns among investors, who had been worried that an uncertain outcome could lead to political haggling to create a new government. The British pound jumped 2 per cent overnight against the dollar to its highest level since February. It held onto the gains Friday, trading at $1.54. “The U.K. general election result is a surprisingly market-friendly outcome and removes the risk that the economy suffers a prolonged period of political uncertainty,” said Vicky Redwood from Capital Economics in London. In the longer term, however, a Conservative win means the U.K. will hold a referendum within two years about leaving the European Union, a big decision that could unsettle business confidence. EUROPE: Major indexes in Europe jumped on the results of the election. Britain’s FTSE 100 rose 2.3 per cent, Germany’s DAX rose 2.6 per cent and France’s CAC 40 gained 2.5 per cent. Prices for European government bonds rose broadly, sending yields lower. ENERGY: The price of benchmark U.S. crude oil rose 69 cents to $59.62 a barrel on the New York Mercantile Exchange. It fell $1.99, or 3.3 per cent, to $58.94 per barrel on Thursday, the biggest drop since April 8. Brent crude rose 17 cents to $65.72 a barrel in London. CURRENCIES: The dollar edged up to 119.78 yen from 119.73 yen. The euro was little changed at $1.1215. Disclaimer The information contained in this communication from the sender is confidential. It is intended solely for use by the recipient and others authorized to receive it. If you are not the recipient, you are hereby notified that any disclosure, copying, distribution or taking action in relation of the contents of this information is strictly prohibited and may be unlawful. This email has been scanned for viruses and malware, and may have been automatically archived by Mimecast Ltd, an innovator in Software as a Service (SaaS) for business. Providing a safer and more useful place for your human generated data. Specializing in; Security, archiving and compliance. To find out more visit the Mimecast website.