|

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

Author

Anil Panchal

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

More from Anil Panchal
Share:

Editor's Picks

USD/JPY eyes August swing low, near 155.20 ahead of US NFP

USD/JPY retests the August monthly swing low during the Asian session on Friday as a more hawkish repricing of BoJ rate-hike bets and a suspected intervention continue to underpin the Japanese Yen. Meanwhile, the US Dollar is seen consolidating the previous day's heavy losses amid soft US bond yields, further weighing on the currency pair as traders keenly await the US NFP report.

AUD/USD consolidates above 0.7200; US NFP awaited

AUD/USD holds steady above 0.7200, near its highest level since mid-May, as bulls await the US NFP report for more cues on the Fed's policy path before placing fresh bets. Meanwhile, the recent decline in US bond yields keeps the US Dollar depressed near its lowest level in over a week and acts as a tailwind for the Aussie amid the RBA's hawkish tilt.

Gold tumbles as blockbuster US NFP lift US Dollar, Treasury yields

Gold (XAU/USD) falls sharply on Friday, snapping a two-day recovery after the US Nonfarm Payrolls (NFP) report surprised strongly to the upside. The metal briefly climbed above $4,500 on Thursday, gaining nearly 2%, but has since erased a large part of that advance.

Crypto’s $638 million buyback boom may not be as bullish as it looks
Decentralized Finance (DeFi) protocols reportedly spent $638 million to buy back their native tokens in August, up 17% from a year earlier. On the surface, the buyback trend suggests the cryptocurrency industry is maturing fast, adopting one of Wall Street’s oldest tools to bolster valuations and distribute revenue. The headline becomes less impressive once the number is opened up.
Why hawkish Bank of Japan expectations aren't enough to sustain the Japanese Yen rally

The Japanese Yen (JPY) experienced a sudden burst higher after falling back below the 160.00 psychological mark against the US Dollar (USD) earlier this week amid a more hawkish repricing of Bank of Japan (BoJ) rate hike expectations.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.