Plus after a roller coaster ride: Strong job growth boosts US stock exchanges

Friday, March 5th, 2021

Plus after roller coaster ride
Strong job creation boosts US stock exchanges

A surprisingly strong increase in jobs in the USA sends the stock market barometer on Wall Street up and down. Investors see the losses that have occurred in the meantime as an opportunity to buy – and stay strong. Even the battered Nasdaq slipped into positive territory in the end.

After a roller coaster ride, Wall Street closed with a strong plus at the end of the week. The trend in yields once again set the direction. Of the Leading index Dow Jones Industrial won at the end of the day 1.85 percent on 31,496 pointswhich results in an almost equally high plus on a weekly basis. The market breadth S&P 500 hung up at the end of the week by 1.95 percent 3841 points to. In the technology-heavy Nasdaq 100 investors also came back after a temporary slide to a low since the end of November: the index closed 1.64 percent higher up 12,668 points. The situation on the US labor market had unexpectedly brightened significantly in February. 379,000 jobs were created outside of agriculture.

Economists were far below with their forecast of 182,000. "Investors are still trying to figure out what they want – in the struggle between continued loose fiscal policy or an actual economic recovery that would require higher interest rates – and they haven't made that decision yet," said strategist Randy Frederick of brokerage firm Charles Schwab. The strong labor market report makes a short-term intervention of the Fed in the bond market less likely, said portfolio manager Thomas Altmann of the wealth advisor QC Partnersstratege. "This means that the current labor market report is the license to increase interest rates."

This was also reflected directly in the ten-year titles in the USA, which with 1.6 percent as high returns as they have not for a year. At the recent appearance of the US Federal Reserve Chairman Jerome Powell, stockbrokers had missed statements that would have indicated that the Fed would intervene in the bond market. He reaffirmed his commitment to ultra-easy monetary policy and further asset purchases. Rising bond yields mean higher financing costs for states and companies. For weeks, this has hit technology stocks hard. The Nasdaq index has fallen eleven percent since mid-February.

You can read about trading on the Frankfurt floor in our stock exchange day.

Tesla shares are in the red

Regardless of this, the oil price went up again. The variety Brent from the North Sea switched 3.4 percent to a 14 month high of $ 69 a barrel (159 liters). On Thursday, "Opec +", which includes the members of the export cartel and other producing countries such as Russia, agreed to extend the current production restrictions. Against the background of the expected recovery of the global economy from the coronavirus consequences, the Brent price could rise to over 80 dollars by the summer, forecast analyst Edward Moya from brokerage house Oanda.

Oil company stocks Chevron and Exxon benefited from rising crude oil prices. The papers won up to 2.3 percent. The shares of Johnson & Johnsonthat around 1.6 percent rose. The Group's corona vaccine has been approved in Canada.

In the wake of a falling Bitcoin price, the shares slipped Tesla and Microstrategy into the minus. The titles of the electric car maker and the software company fell by around around 5.5 percent. Both have invested billions in the oldest and most important cyber motto. "Equity investors are now getting to know the other side of the coin of Bitcoin addiction," says analyst Timo Emden from Emden Research.