Global stock markets mostly higher after Wall Street surge

By: |
September 03, 2020 4:09 PM

Analysts said that could be a warning sign the job market is cooling after some US states reimposed anti-virus controls and the expiration of supplemental unemployment benefits cut into consumer spending.

In Asia, the Shanghai Composite Index opened higher but retreated to close down 0.6% at 3,384.98.

Most major stock markets and US futures rose on Thursday after Wall Street surged to its biggest daily gain since July despite uncertainty about the global outlook. London, Frankfurt and Tokyo advanced while Shanghai declined.
Investors have been encouraged by central bank infusions of credit into struggling economies and hopes for a vaccine to end the coronavirus pandemic that has plunged the world into its deepest slump since the 1930s.

Forecasters warn the stock market recovery might be running too far ahead of economic activity as the United States and some other countries reimpose anti-virus controls that hamper business. The irony of market exuberance is rich, said Mizuho Bank in a report. Record highs on Wall St make a mockery of policymakers grasping for recourse to the worst downturn in decades.

In early trading, the FTSE 100 in London gained 0.7% to 5,981.93 and the DAX in Frankfurt added 1.4% to 13,428.33. The CAC 40 in France added 1.6% to 5,112.38. On Wall Street, the future for the benchmark S&P 500 index was up less than 0.1% while that for the Dow Jones Industrial Average gained 0.2%.

On Thursday, the S&P 500 rose 1.5%. The index is up 10.8% this year following a five-month streak of gains. The Dow Jones Industrial Average gained 1.6%. The Nasdaq composite added 1% to 12,056.44. The tech-heavy Nasdaq is up 34.4%, driven by gains for Apple and other technology giants that investors believe are safe bets as the public spends more time on internet-connected devices.

In Asia, the Shanghai Composite Index opened higher but retreated to close down 0.6% at 3,384.98. The Nikkei 225 in Tokyo gained 0.9% to 23,465.53. The Hang Seng in Hong Kong lost o.5% to 25,001.30. The Kospi in Seoul advanced 1.3% to 2,395.90 and Sydney’s S&P-ASX 200 was up 0.8% at 6,112.60. India’s Sensex was unchanged at 39,092.05. New Zealand and Bangkok gained while Singapore and Jakarta retreated.

US stocks have gained despite lack of agreement in Congress on a new economic aid package with additional unemployment benefits to support consumer spending. A report by payroll processor ADP, widely watched as a forerunner of government employment data due out Friday, showed the private sector added 428,000 jobs in August, less than half the 1 million expected by forecasters.

Analysts said that could be a warning sign the job market is cooling after some US states reimposed anti-virus controls and the expiration of supplemental unemployment benefits cut into consumer spending. “Bullish stock market sentiment seems to be nearing a tentative peak as the labor market recovery stalls,” said Edward Moya of Oanda in a report.

Also Wednesday, the US Federal Reserve said its August survey of businesses found enduring uncertainty over the pandemic and the harm it causes to consumer and business activity. Health care and communications stocks also helped to drive Wednesday’s rally.

Benchmark US crude oil for October delivery lost 36 cents to $41.15 per barrel in electronic trading on the New York Mercantile Exchange. The contract slid $1.25 on Wednesday. Brent crude, the basis for pricing international oils, declined 48 cents to $43.95 per barrel in London. It dropped $1.15 the previous session to $44.43 a barrel.

The dollar rose to 106.24 yen from 106.16 yen on Wednesday. The euro declined to $1.1816 from $1.1855.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Acme Solar raises $334 million through green bonds
2Cholamandalam profit after tax down 24% in Q1
3Spreads between government securities, corporate bond narrow on weak demand