September Closes Without Another Fall |
Yesterday at the close of trading in New York, US stock markets rose, bouncing back from their earlier losses. Lower than expected unemployment claims in the US and the German parliament’s approval to increase the European Financial Stability Fund helped to compensate for the drop in the middle of the week, which came at the expense of high-tech companies and the consumer sector. Greek bonds increased, and the Euro appreciated. The Standard & Poor’s 500 Index went up 0.8% to 1,160.40 at the close of trading in New York, recovering after a 1% drop the day before. The Nasdaq Composite Index fell 0.4%, while the Stoxx Europe 600 increased 0.7% after banking sector stocks strengthened. Yields on two-year Greek bonds fell 453 basis points to 65.24%. Natural gas went down 1.4% in price after the US reported growth in supplies at the same time that oil prices rose.
DT Trading analysts believe that on Friday, at the close of the month, it will be apparent whether the American stock market will hold onto the lows it reached or manage develop an upward movement at the beginning of next month. Other analysts however, are filled with euphoria regarding the stock market’s perspectives. In particular, Philip Orlando from Federated Investors Inc., assesses the GDP data and unemployment figures from Thursday positively, calling them “…two outstanding figures.” Nevertheless, even if the US manages to rally the market with some good statistics, DT Trading economists are convinced that it will still be a long time before they will have as strong of an affect on the market like the latest data and news from Europe did. They cite proof of this as the dynamic of trading on the same North American stock market, where earlier-achieved growth was leveled by sales in the middle of the day.
The S&P 500 rose 2.2% yesterday at the start of the trading day after the American economy rose 1.3% in the second quarter; this was stronger than earlier predictions. Unemployment claims dropped by more than was expected (an increase of 37,000) to reach 391,000, the lowest figure since April of this year, according to government data. Meanwhile, German Chancellor Angela Merkel received support from legislators to expand the size of the European Financial Stability Fund.
Yesterday, the Euro rose 0.4% to $1.3597. The currency shared by 17 European countries also appreciated 0.7% against the yen while the Dollar Index, which reflects the American currency’s value against the currencies of six of the US’s major trading partners, rose only 0.1%.
Yields on Greek 10-year bonds fell for the third day in a row, dropping 37 basis points to 22.67%. This also caused bond yield spreads to benchmark German debt to fall 37 basis points to 2,066 basis points. Yields on 10-year Italian bonds slipped 7 basis points to 5.58% after the government sold 7.9 billion Euros ($10.8 billion) of debt securities. Yields on Portuguese 10-year bonds fell 42 basis points to 11.16%, falling for the second day in a row.
Today, traders are awaiting publication of data on Canada’s GDP; growth is being predicted at 0.3% in July M/M and 2.3% Y/Y.
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