USmarket Before Friday US labor survey key stock indexes remain within the limits of a trading range
11:47 04/06/2006

After yesterday's statements of FRS representatives that the level of the basic interest rate was close to a target, shares on Wall Street opened with little growth on Wednesday.

 

Yesterday the main driver of growth became Apple Computer Inc. papers. We shall remind that owing to output of new software from Apple Computer Inc. the company’s shares hiked 10 % at once.

Supported by growth of Apple Computer Inc. papers NASDAQ and S&P 500 indexes rose up to new five years' highs.

 

Key indexes were also supported by data on the index of Institute for Supply Management for non-productive sector of the USA. It is also necessary to remember that about 90 % of GDP of the USA falls to a share of service sphere.

ISM calculates the index on the basis of data of 370 companies from 62 service sectors. Value of the indicator above 50 points means expansion of sector, below - recession.

So, the indicator grew from 60.1 in February up to 60.5 points in March, 2006. At the same time analysts expected value of March index at a level of 59.0 points.

Thus the employment index made 54.6 points against 58,2 points a month earlier. The price index made 60.5 points against 64,8 points. And the new orders index in service sphere made 59.5 points against 56.2 points.

The main reason of growth of the indicator, in experts’ opinion, became high expenses of the population of the USA, and also appreciable improvement of a situation in a labor market.

 

On the other hand, yesterday stock indexes were supported a little by statements of the U.S. Treasury Secretary John Snow that the March survey of the US labor market has "good numbers".

Let's remind that in Congress of the USA John Snow has also noticed that it is necessary to accelerate economic growth in the USA.

 

"To use all our potential the economy should develop at faster rates and it is necessary to create new highly skilled workplaces for the US citizens", - Snow told, representing the budget for 2007.

U.S. Department of the Treasury expects to meet with approval of the budget at a rate of $11.6 billion in 2007 that exceeds a little the budget for 2006.

 

Data on oil stocks, which showed reduction of petroleum stocks in the USA, could not reduce an optimistical mood of investors.

Let's remind that as the US Department of Energy informed on Wednesday oil stocks in the USA for a week, ended on March, 31st, 2006, were up 2.1 million barrels to 342.8 million barrels.

Petroleum stocks were down 4.4 million barrels to 211.8 million barrels. Thus distillates stocks dipped 2.6 million barrels to 121.6 million barrels, and stocks of oven fuel were down 1.7 million barrels to 44.4 million barrels.

As a result right after publications of these data quotations of the May futures for the American oil rose above $ 67 for barrel, however then decreased and today they are at a level $ 66.75.

 

As a result Dow-Jones index of New York stock exchange grew 35.70 points and was closed at a level 11239.55. NASDAQ index rose 14.39 points and is at a level 2359.75. S&P 500 index was up 5.63 points and is at a level 1311.56.

And 30 - year U.S. Treasury notes’ yield fell 0.020 in comparison with the previous closing and makes 4.893.

 

Until Friday US labour market survey we recommend to keep a waiting position. Opening of new purchases of key indexes futures will be possible only after the end of correction.

 

 


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