Wall Street Close: Bulls cheer upbeat data, risk-on mood with eyes on Nonfarm Payrolls

  • All three US equity benchmarks closed in green for the first time this week, DJI30 closed at record top.
  • US Jobless Claims, Nonfarm Productivity and Challenger Job Cuts back an upbeat NFP.
  • Vaccine news battle noise from China as markets enjoy receding reflation fears.
  • All eyes on US employment data for April, risk catalysts.

Thursday turned out to be good for US investors as all three key indices closed positive for the first time in a week. Although equity gains were mild due to mixed catalysts and the pre-NFP cautious sentiment, market sentiment remains positive ahead of the key US data.

Dow Jones Industrial Average (DJI30) marks all-time high closing of 34,548.53, up 0.93% or 318.19 whereas S&P 500 adds around 34 points, or 0.82%, on a day while ending the day near 4,201. Further, Nasdaq finally overcomes the tech-rout, for now, by gaining 0.37% or 50.42 points on a day by the end of Thursday’s North American session.

The US rejection to ease investment limits on China and comments from Dallas Fed President Robert Kaplan tried to keep the markets pressured. However, Kaplan’s non-voting-member status and American support to waive IP protections for the covid vaccines, later joined by the European Union (EU), favored the mood. Also on the risk-positive side were comments from other Fed officials who kept supporting easy money policies.

Elsewhere, US Jobless Claims dropped to 498K for the week ended on April 30, taking the four-week average down to 560K from upwardly revised prior to 621K. Further, Challenge Job Cuts for April dropped while Nonfarm Productivity for Q1 2021 crossed upbeat forecasts.

Vaccine producers like Pfizer and Moderna were down while Novavax and Johnson & Johnson printed mild gains. US 10-year Treasury yields dropped 1.4 basis points (bps) to 1.57% whereas the US dollar index (DXY) marked the heaviest losses in two weeks and backed the commodities.

Moving on, nothing matters more than the US employment figures for April. Although early signals for the key US data back upbeat prints, forecasts are too high to pose a downside risk to the markets if disappointed.

Read: US Nonfarm Payrolls April Preview: When the economy booms, it's all about rates

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