Wall Street heads into the final stretch of the year with fresh confidence that the worst of the economic crisis is over, setting up a positive environment for the market heading into next year.
The main US stock indexes notched gains in the week to Friday, buoyed by data showing a sharp turnaround in the job market that offered hopes for a sustained recovery from recession.
The market extended the powerful rally that began in March, with the Dow Jones Industrial Average gaining 0.76 percent for the week to 10,388.90.
The tech-dominant NASDAQ composite jumped 2.61 percent to 2,194.35 while the Standard & Poor’s 500 broad-market climbed 1.33 percent on the week to 1,105.98.
With a rally of more than 60 percent from the lows in March, the Dow has risen 18.37 percent for this year, while the NASDAQ is up 39.14 percent and the S&P 500 index 22.44 percent.
The market was reassured by Friday’s data showing a dramatic turnaround in the US labor market. The data showed job losses narrowed to 11,000 last month from 111,000 in October, and the unemployment rate dipped to 10 percent from 10.2 percent.
The report “is the most important piece of incrementally positive news regarding the economic recovery seen to date,” said Fred Dickson at DA Davidson & Co, adding that it “should lift consumer and investor confidence on Main Street.”
The November employment report “should reduce some of the pervasive fear factor currently held by huge numbers of individual investors,” he said.
“Any way you slice this, it is a good number for the US economy and its growth initiative,” Kevin Giddis at Morgan Keegan said. “Caution is still the better path and we are a long way from standing on our own, but today’s number suggests that the economy is on a trend line to growth.”
Peter Lucas, investment strategist at RBC Wealth Management, said many investors have been underestimating the strength of the recovery in the US and global economies, and some caution has been added to the equation by Dubai’s debt problems.
Bonds took a beating from signs of a stronger economy that may prompt the Federal Reserve to hike interest rates sooner than expected.
The yield on the 10-year Treasury bond rose sharply to 3.483 percent from 3.211 percent a week earlier and that on the 30-year bond climbed to 4.413 percent from 4.209 percent. Bond yields and prices move in opposite directions.
In the coming week, market-moving news may come from Tuesday’s report on the US balance of trade and, more significantly, Friday’s retail sales data from last month, which will provide clues on consumer spending heading into the holiday season.
The CIA has a message for Chinese government officials worried about their place in Chinese President Xi Jinping’s (習近平) government: Come work with us. The agency released two Mandarin-language videos on social media on Thursday inviting disgruntled officials to contact the CIA. The recruitment videos posted on YouTube and X racked up more than 5 million views combined in their first day. The outreach comes as CIA Director John Ratcliffe has vowed to boost the agency’s use of intelligence from human sources and its focus on China, which has recently targeted US officials with its own espionage operations. The videos are “aimed at
STEADFAST FRIEND: The bills encourage increased Taiwan-US engagement and address China’s distortion of UN Resolution 2758 to isolate Taiwan internationally The Presidential Office yesterday thanked the US House of Representatives for unanimously passing two Taiwan-related bills highlighting its solid support for Taiwan’s democracy and global participation, and for deepening bilateral relations. One of the bills, the Taiwan Assurance Implementation Act, requires the US Department of State to periodically review its guidelines for engagement with Taiwan, and report to the US Congress on the guidelines and plans to lift self-imposed limitations on US-Taiwan engagement. The other bill is the Taiwan International Solidarity Act, which clarifies that UN Resolution 2758 does not address the issue of the representation of Taiwan or its people in
US Indo-Pacific Commander Admiral Samuel Paparo on Friday expressed concern over the rate at which China is diversifying its military exercises, the Financial Times (FT) reported on Saturday. “The rates of change on the depth and breadth of their exercises is the one non-linear effect that I’ve seen in the last year that wakes me up at night or keeps me up at night,” Paparo was quoted by FT as saying while attending the annual Sedona Forum at the McCain Institute in Arizona. Paparo also expressed concern over the speed with which China was expanding its military. While the US
SHIFT: Taiwan’s better-than-expected first-quarter GDP and signs of weakness in the US have driven global capital back to emerging markets, the central bank head said The central bank yesterday blamed market speculation for the steep rise in the local currency, and urged exporters and financial institutions to stay calm and stop panic sell-offs to avoid hurting their own profitability. The nation’s top monetary policymaker said that it would step in, if necessary, to maintain order and stability in the foreign exchange market. The remarks came as the NT dollar yesterday closed up NT$0.919 to NT$30.145 against the US dollar in Taipei trading, after rising as high as NT$29.59 in intraday trading. The local currency has surged 5.85 percent against the greenback over the past two sessions, central
RSS