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Stocks May Extend Yesterday's Recovery In Early Trading - U.S. Commentary


After pointing to a lower open for the markets for much of the morning, stock futures have turned positive following the release of the closely watched monthly jobs report. The Dow futures are currently up by 48 points.

The futures turned positive after the Labor Department's monthly employment report showed much weaker than expected job growth in the month of November.

While the report paints a less favorable picture of the labor market, the data may ease recent concerns about the Federal Reserve raising interest rates too aggressively.

A report from the Wall Street Journal on Thursday said officials are considering signaling a "wait-and-see mentality" after a likely interest rate hike later this month.

The report contributed to a substantial turnaround on Wall Street, with stocks rebounding after falling sharply early in the session amid continued skepticism about a U.S.-China trade deal.

The Labor Department said non-farm payroll employment rose by 155,000 jobs in November after surging up by a downwardly revised 237,000 jobs in October.

Economists had expected employment to climb by about 200,000 jobs compared to the jump of 250,000 jobs originally reported for the previous month.

Meanwhile, the report said the unemployment rate in November remained unchanged for the second straight month at 3.7 percent, holding at its lowest level since hitting 3.5 percent in December of 1969.

Average hourly employee earnings rose by $0.06 to $27.35 in November, reflecting a 3.1 percent increase compared to the same month a year ago.

Shortly after the start of trading, the University of Michigan is scheduled to release its preliminary report on consumer sentiment in the month of December.

The consumer sentiment index is expected to edge down to 97.0 in December after dipping to 97.5 in November.

The Commerce Department is also due to release its report on wholesale inventories in the month of October. Wholesale inventories are expected to climb by 0.7 percent.

Later in the day, the Federal Reserve is scheduled to release its report on consumer credit in the month of October. Consumer credit is expected to jump by $17.0 billion.

After falling sharply early in the session, stocks showed a substantial rebound over the course of the trading day on Thursday. The major averages bounced well off their worst levels of the day, with the tech-heavy Nasdaq climbing into positive territory.

The Dow fell by nearly 800 points to its lowest intraday level in over a month but ended the day down by just 79.40 points or 0.3 percent at 24,947.67. The S&P 500 edged down 4.11 points or 0.2 percent to 2,695.95, while the Nasdaq rose 29.83 points or 0.4 percent to 7,188.26.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Friday. Japan's Nikkei 225 Index advanced by 0.8 percent, while Australia's S&P/ASX 200 Index rose by 0.4 percent.

The major European markets have also moved to the upside on the day. While the German DAX Index has climbed by 0.6 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index are jumping by 1.4 percent and 1.6 percent, respectively.

In commodities trading, crude oil futures are soaring $2.27 to $53.76 a barrel after tumbling $1.40 to $51.49 a barrel on Thursday. Meanwhile, after rising $1 to $1,243.60 an ounce in the previous session, gold futures are climbing $4.10 to $1,247.70 an ounce.

On the currency front, the U.S. dollar is trading at 112.80 yen compared to the 112.68 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.1388 compared to yesterday's $1.1374.

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