The S & P 500 Close up 1. FP7 to 1,330.97, its gain of a day more marked since the beginning of December. During this time, the Dow Jones Industrial Average ended 1. higher than 12,258.20 FP6.
After a month, dominated by the tumult in North Africa and a yo-yoing oil prices, investors warmed to the evidence that the US stagnant jobs market may finally be turning. The number of Americans seeking unemployment benefits dropped to its lowest level for more than two years. Wall Street economists were more impressed by the decline in the average of four weeks, a less volatile measure, which fell to 388,500, its lowest level since July 2008.
A stubbornly high unemployment rate which has not fallen below 9pc since the spring of 2009, has prompted the Federal Reserve to resume quantitative easing last November.
Further evidence that the labour market is improving will begin to escape financial markets not only with the likely end of QE in June, but with the prospect of the Fed, interest rates increase.
"No none can deny that a strengthening in the conditions of the labour market is underway,", said Jim Baird, Plante Moran financial advisors. "Combined with the increase in consumer demand, this should translate to a more rapid pace of job creation in time."
That hope will be tested today with the release of the monthly jobs report, which economists predict will show 200,000 jobs were created last month. Ben Bernanke, the Fed Chairman, said this week he is optimistic that the recovery will begin to generate jobs in the coming months.
America's service sector also struck a brilliant note yesterday, with the Institute for supply showing management indexes that it expanded at the fastest pace since August 2005. The index hit 59.7 in February, with a reading above 50 signals growth.
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