Benchmarks finished in the green on the first trading day of
November banking on positive consumer confidence and private
sector jobs data. In the aftermath of Hurricane Sandy's havoc,
investors drew strength from the slew of bullish economic
reports. The consumer confidence index touched its highest level
in more than four years. Investors will keep their eyes fixed on
non-farm payroll data that is scheduled for release tomorrow.
Industrials and materials were the major gainer among the S&P
500 groups. The S&P 500 registered its best day in seven
weeks and the blue-chip index also scored its best day since
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The Dow Jones Industrial Average (DJI) jumped 1.0% to close the
day at 13,232.62. The Standard & Poor 500 (S&P 500)
surged 1.1% to finish yesterday's trading session at 1,427.59.
The tech-laden Nasdaq Composite Index rose 1.4 % to end at
3,020.06. The fear-gauge CBOE Volatility Index (VIX) tumbled
10.3% to settle at 16.69. Consolidated volumes on the New York
Stock Exchange, American Stock Exchange and Nasdaq were roughly
6.7 billion shares, marginally higher than the daily average of
6.5 billion shares. Advancers outpaced the decliners on the NYSE;
as for 74% stocks that gained, 22% stocks closed in the red.
Automatic Data Processing's (NASDAQ:
) National Employment report revealed that the U.S. private
sector added 158,000 jobs in the month of October in comparison
to 114,000 in the month of September. This was above the Street's
estimates. According to the report, large businesses added 81,000
jobs, whereas medium and small businesses added 27,000 and
50,000, respectively, in the month of October. The service sector
added 144,000 jobs, while goods producers accounted for 14,000
more jobs. Construction and professional/business services added
23,000 and 35,000 jobs, respectively. However, the manufacturing
industry reported a decline of 8,000 jobs.
Separately, the U.S. Department of Labor released its initial
claims report, according to which the number of Americans filing
for unemployment has decreased from the previous week. According
to the report, the advance figure for seasonally adjusted initial
claims for the week ending October 27 decreased by 9,000 to
363,000 from the previous week's 372,000. The reported was below
consensus estimates of 372,000.
Meanwhile, the consumer confidence index touched its highest
level since February 2008. According to the report, the consumer
confidence index increased to 72.2 in October from 68.4 in
September, beating the consensus estimate of 71.4. The present
situation index increased to 56.2 from 48.7, while the
expectations index increased to 82.9 from 81.5 recorded last
month. The increase in consumer confidence was boosted by the
improving job market.
Meanwhile, the ISM manufacturing index rose by 0.2 points to 51.7
in October from 51.5 in the month of September. This was above
the consensus estimates of 51.2. New orders increased by 1.9% to
54.2, whereas the production index increased 2.9% to 52.4. The
employment index declined by 2.6% to 52.1. According to market
experts, the manufacturing sector has supported the U.S. economy
in such difficult times.
Meanwhile, construction spending edged up 0.6% from August to a
seasonally adjusted annual rate of $851.6 billion in September.
This was in line with consensus estimates of a 0.6% increase. The
September 2012 figure is 7.8% above September 2011 estimates of
$790.3 billion. Private and public construction spending
increased by 1.3% and 0.8%, respectively.
Coming to corporate results, Pfizer Inc.'s (NYSE:
) revenues fell short of estimates. The company's shares slipped
1.3% after the results. Exxon Mobil Corporation's (NYSE:
) shares surged 0.5% after the company posted quarterly results.
Profits came in above analysts' estimates but slipped from the
The Materials Select Sector SPDR (XLB) gained 2.1% and was the
major gainer among the S&P 500 industry groups. Stocks such
as Monsanto Company (NYSE:
), E I Du Pont De Nemours And Co (NYSE:
), FMC Corporation (NYSE:
), Dow Jones Industrial Average (INDEXDJX:
) and PPG Industries, Inc. (NYSE:
) surged 0.9%, 1.1%, 2.2%, 2.8% and 4.0%, respectively.