Jobs in the USA
by Peter Switzer
I have been saying for two weeks now that the stock market’s direction will be determined by the battle between Libya and other oil contagion countries and the US recovery. Overnight, the Yanks had a big win with stocks up over 1.5 per cent.
The driver for this surprise outcome was a great result with US jobless claims and it comes ahead of the jobs report out tonight in the States.
"I think the market is very pleased about the initial jobless claims numbers," Jeremy Zirin, chief U.S. equity strategist at UBS Wealth Management told CNBC. "The most lagging component of this recovery has been jobs, and now we’re starting to see a pick up."
Initial claims fell 20,000 last week to 368,000 and it’s the best reading since May 2008.
If the jobs gain is in the 180,000 to 200,000-level, then we could see some more of this robust share buying. And if some kind of peace can be brokered in Libya, then Wall Street could be off to the races.
That said, the oil country contagion doesn’t look like it will go away very easily and that should keep a lid on enthusiasm.