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Market week: Strong U.S. job creation lifts markets
4/20/2019 6:58:48 AM
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By Fund Library News Wire  | Friday, April 05, 2019


 

By Mike Keerma

Buoyed by a better-than-expected U.S. job creation report for March, the major North American stock market indices logged strong gains for the week, with both the S&P 500 Composite Index and the Nasdaq Composite Index ahead over 2%, putting the Nasdaq’s year-to-date gain now at nearly 20%. Toronto’s benchmark S&P/TSX Composite Index benefitted from a surge in energy issues as crude oil gained over 5% on the week, while financials maintained strength, with the S&P/TSX Capped Financial Index gaining 2.4% on the week.

Index

April 5, 2019, close

Day

Week

Year to date

S&P/TSX Composite

16,396.15

0.5%

1.83%

14.48%

S&P 500 Composite

2,892.74

0.5%

2.06%

15.39%

Nasdaq Composite

7,938.69

0.8%

2.71%

19.64%

Gold (US$)

$1,295.70

0.1%

-0.10%

1.25%

Oil (WTI) (US$)

$63.28

1.9%

5.12%

39.35%

The U.S. Bureau of Labor Statistics reported Friday that the economy created 196,000 new jobs in March, substantially exceeding street estimates of around 175,000. The powerful gain reverses an unusually weak report in February, easing some of anxiety in the first two months of the year that the U.S. economy may have been headed for a slowdown.

The U.S. unemployment rate held at 3.8%, its lowest level in nearly 50 years, indicating a full-employment economy, while annualized wage growth eased a couple of points, to 3.2% from 3.4% in February, still the fastest pace in about 10 years. All this points to still-strong underlying economic growth, and allays investor concerns that the Federal Reserve might have contemplated an interest rate cut instead of a hike later this year.

In Canada, the economy saw a modest decline in jobs, losing about 7,200 in March, after six months of strong job gains that saw about 300,000 new jobs added, with the unemployment rate remaining at a very comfortable 5.8%. Wage growth also ticked up in March, rising at an annual rate of 2.3%, compared with 2.2% in February. As in the U.S., the overall positive Canadian jobs data, despite the weakness in March, generally allayed investor concerns about a possible rate cut by the Bank of Canada. Investors were further mollified by comments from Bank of Canada Governor Stephen Poloz who indicated this past week that Canada would emerge from this period of softer economic growth but that rates would continue slightly below the neutral range.

Check Fund Library’s Market Activity page regularly for active updates on key market indexes and commodities.

@FundLibrary – Follow Fund Library on Twitter for daily information and updates.

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© 2019 by Fund Library. All rights reserved. Reproduction in whole or in part by any means without prior written permission is prohibited.

The foregoing is for general information purposes only and is the opinion of the writer. No guarantee of investment performance is made or implied. It is not intended to provide specific personalized advice including, without limitation, investment, financial, legal, accounting or tax advice.

 
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