Wall Street increases before the U.S. jobs report

The U.S. stock market rose on Thursday as investors waited for the next move by the Federal Reserve ahead of crucial jobs on Friday.

The S&P 500 gained 0.5 percent in New York, adding to recent records that traders weigh in on strong corporate earnings forecasts as the Fed cuts its monthly bond purchases that have secured asset prices during the pandemic. The technology-oriented Nasdaq Composite index rose 0.1 percent as it traded earlier in the day.

The dollar index, which measures the green dollar against its peers around the world, rose 0.1 percent from its beginning in April to its highest level. This change helped send the pound sterling and the euro to two-month lows against the dollar at $ 1.3761 and $ 1.1846, respectively.

The move reported non-agricultural monthly payrolls on Friday. Economists surveyed by Bloomberg expect employers to add about 700.00 jobs in June, up from 559,000 a month earlier.

“The only thing I think would have surprised the market if it was constantly missing is because we’ve failed two in a row,” said Jurrien Timmer, director of global macro at Fidelity Investments. “It’s a matter of how quickly employers go out to hire employees, and that’s an important sign for the Fed… Because if they’re trying to normalize policy, but companies still don’t hire a lot of people, then that’s a sign that they should hold on.”

Fed Chairman Jay Powell is committed to continuing to support monetary policy until the labor market recovers from the pandemic damage. At the last meeting, however, the central bank’s policy makers raised their growth and inflation forecasts for the U.S. and raised the forecast for the first rate hike following the pandemic to 2023.

“The market can be very nervous” about a strong payroll number, “given the relatively weak stance the Fed has taken over the past month,” said Lale Akoner, BNY Mellon’s chief market strategist.

But investors were also expected to expect “the Fed to talk about that”. . . quickly eliminates unrest, ”added Akoner, after central bank officials it calmed the nerves of investors they made sure it was too early to raise rates after the June meeting.

The yield on the 10-year Treasury benchmark bond, which has fallen since last Fed’s bond purchases, rose to 1.45 per cent.

In Europe, the Stoxx 600 capital index closed 0.6 percent as traders sidestepped a complex view of U.S. assets to focus on the new economic recovery in the eurozone from the Covid-19 crisis.

Energy stocks were a benchmark for the entire region as the price of crude Brent rose 1 percent to a high of $ 75.38 a barrel. Analysts expected it to be just a group of oil-producing countries gradually increased production, even as economies around the world open up after the pandemic.

“The oil sector has experienced a lot in the last seven or eight years,” said Sean Naughton, U.S. vice president of equities at RBC Wealth Management. “It’s been a tough space, but I think there have been a lot of improvements in the sector in terms of the amount of shale production in the US. That can keep supply under control. “.

While the global oil benchmark was near its highest level since October 2018, West Texas Midlands, the U.S., rose 1.8 percent to $ 74.75 a barrel.

In the last quarter ended Wednesday, European stocks lagged behind U.S. markets as the S&P 500 rose 8.2% against the 5.4% rise in the Stoxx 600.

“Europe has delayed the US in managing the virus and its economic recovery, but it is doing better now, so it is attracting foreign capital, while European investors are also looking inward,” said Olivier Marciot, manager of cross-asset funds at Unigestion.

The eurozone’s gross domestic product fell in the first three months of this year, while the US achieved quarter-on-quarter growth of 1.6%. It is expected to be a common currency block it returned to growth in the second quarter, However.

The European Central Bank is also likely to keep the program of buying emergency bonds for investors longer than its U.S. counterpart. “The real GDP of the eurozone will be slightly surpassed by the US in 2022,” strategist Sean Darby Jefferies wrote in a research note.

“The ECB will be much slower and narrower than the Fed.”