Home' Trinidad and Tobago Guardian : May 10th 2015 Contents MAY 10 • 2015 www.guardian.co.tt SUNDAY BUSINESS GUARDIAN
STOCKS | SBG9
The US stock market had
its best day in two
months Friday following
encouraging news about
the job market.
The surge was enough to push two of the
three major indexes to gains for the week.
European markets also rose sharply after
David Cameron s Conservative Party won an
outright majority in Britain s Parliament, greatly
reducing the threat of political uncertainty
The Dow Jones industrial average gained
267.05 points, or 1.5 per cent, to 18,191.11. The
Standard & Poor s 500 index added 28.10
points, or 1.4 per cent, 2,116.10, its biggest
per centage gain since March 16. The Nasdaq
composite rose 58 points, or 1.2 per cent, to
Investors cheered news that US employers
added 223,000 jobs in April, a solid gain sug-
gesting that the economy may be recovering
after a stumbling start to the year. The unem-
ployment rate fell to 5.4 per cent from 5.5 per
cent in March, the lowest rate since May 2008.
While the jobs report is always closely
watched, April s survey garnered even more
interest than usual. The revised March figures
were abysmal, with employers creating only
85,000 jobs that month.
"I am even more convinced that the March
report was an outlier," Paul Christopher, an
investment strategist with Wells Fargo Advisors.
"We all know the first quarter was a tough
quarter. The jobs numbers needed to hold up
and they did."
Both the Dow and S&P 500 ended frac-
tionally higher for the week, while the Nasdaq
ended down less than 0.1 per cent.
The bond market took a more nuanced take
on the employment report. Investors bought
bonds, pushing the US 10-year Treasury note s
yield down to 2.14 per cent from 2.18 per cent
Thursday. That rate had been as high as 2.30
per cent just two days ago, representing a big
move for that market.
Bond traders noted that while the job survey
was positive overall, there were several troubling
signs, including sluggish wage growth. The
disappointing March number also cast doubt
on how solid the economy s footing is. As a
result, they said, the Federal Reserve could
hold off longer than previously expected before
raising interest rates.
"These numbers are starting to lead investors
to the same conclusion that the Fed will not
lift rates through 2015," said Tom di Galoma
at ED&F Man Capital.
In Europe, the UK s Conservative Party
surged to get a majority lead in Britain s par-
liamentary election, meaning Cameron will
remain in power. The clarity of the result eased
concerns among investors, who had been wor-
ried that an uncertain outcome could lead to
political haggling to create a new government.
Britain s FTSE 100 rose 2.3 per cent, Ger-
many s DAX rose 2.6 per cent and France s
CAC 40 gained 2.5 per cent. Prices for Euro-
pean government bonds rose broadly, sending
The British pound advanced sharply against
the dollar and euro.
"The UK general election result is a sur-
prisingly market-friendly outcome," said Vicky
Redwood from Capital Economics in London.
Visa was among the biggest gainers in the
S&P 500 and Dow. Shares in the payment
processor jumped in late-afternoon trading
after Bloomberg News reported Visa is in talks
to buy Visa Europe. Visa Europe was split off
from Visa Inc. in 2007 when the US-based
Visa decided to become a publicly-traded
company. Visa Europe is owned by European
banks, which is similar to how Visa was struc-
tured before it went public.
The price of oil rose slightly Friday as the
dollar weakened. Benchmark US crude rose
45 cents to close at US$59.39 a barrel on the
New York Mercantile Exchange, ending a
volatile week nearly flat. After finishing last
week at US$59.15 a barrel, oil rose to its highest
level in four months Wednesday, then fell
sharply on Thursday. Brent crude fell 15 cents
Friday to close at $65.39 in London.
In other energy futures trading on the
NYMEX, wholesale gasoline rose 0.2 cent to
close at $1.992 a gallon, heating oil fell 0.8
cent to close at $1.954 a gallon and natural
gas rose 14.6 cents to close at $2.880 per 1,000
In metals trading, gold rose $6.70 to
$1,188.90 an ounce, silver rose 17 cents to
$16.47 an ounce and copper was little changed
at $2.92 a pound.
How the Dow Jones industrial
average fared Friday
The US stock market had its best day in
two months Friday following encouraging
news about the job market. The surge was
enough to push two of the three major in-
dexes to gains for the week.
The Dow Jones industrial average added
267.05 points, or 1.5 per cent, to 18,191.11.
The Standard & Poor's 500 index rose
28.10 points, or 1.4 per cent, to 2,116.10.
The Nasdaq composite rose 58 points, or
1.2 per cent, to 5,003.55.
For the week:
The Dow rose 167.05 points, or 0.9 per
The S&P 500 index gained 7.81 points, or
0.4 per cent.
The Nasdaq lost 1.84 points, or 0.04 per
For the year:
The Dow is up 368.04 points, or 2.1 per
The S&P 500 index is up 57.20 points, or
2.8 per cent.
The Nasdaq is up 267.49 points, or 5.7 per
jump the most
...Job market gets boost
Europe confronted on Friday the cold certainty of
an unprecedented British referendum on EU
membership after David Cameron s election win,
with two years of tough talks ahead to prevent
a so-called "Brexit."
Work was to start quickly at the European Union s head-
quarters in Brussels after Cameron, whose Conservatives
secured a surprise majority, confirmed his intention to let
Britons vote in 2017 on whether to stay in or leave.
Cameron says he wants Britain to remain in the 28-nation
bloc, but only if he can secure reforms such as changes on
migration and benefits, and the repatriation of certain powers
European Commission chief Jean-Claude Juncker---who as
head of the EU s executive arm would be responsible for
drawing up plans for any changes---quickly offered an olive
"I stand ready to work with you to strike a fair deal for the
United Kingdom in the EU and look forward to your ideas
and proposals in this regard," the former Luxembourg prime
minister said in a short statement.
Juncker had opened the door last week to minor changes
to the EU s treaties, but his spokesman insisted Friday that
the bloc s four key principles including freedom of movement
The other freedoms are movement of goods, services and
EU President Donald Tusk skirted around the issue but
called on Cameron to keep "making the case for the UK s
But Federica Mogherini, the EU s foreign policy chief, said
the British election result was "completely reassuring".
"It s a surprise and I would say it s good news in terms of
stability, as one year ago we were all worried about instability
and the lack of governability," she said during an event in Flo-
Televisions in Brussels were tuned in to Cameron s Downing
Street victory speech after an election result that ends five
years of Conservative coalition with the europhile Liberal
While it concentrated on domestic issues, he stressed that
he would live up to his pledge to hold an in-out referendum
"on our future in Europe."
Cameron s strident but still vague demands for reform have
however put him at odds with many other European leaders
including German Chancellor Angela Merkel, the continent s
Many in Brussels had been hoping Cameron s Labour rival
Ed Miliband would win, given that Miliband, who resigned
Friday following his defeat, had ruled out an EU referendum.
"The British are wrong if they think their partners are ready
to pay a heavy price to keep them in, especially if that price
deprives the whole European project of any meaning," one
European diplomat told AFP in Brussels.
The British election result is the starting gun for bruising
negotiations over the coming two years, beginning with a
European summit in June at which Cameron is likely to set
out the reforms he wants.
Previous summits have seen Cameron isolated and red-
faced as he pushed his agenda, but analysts say this time it
may be different.
Mats Persson, director of the Open Europe think-tank, said
that after months of "posturing" Europe would now take the
referendum seriously because it was a "new event, we have
never seen something like that before. It s huge event for the
"It s now getting real for people," Persson told AFP.
EU wakes up to 'Brexit' nightmare after British vote
Traders work at the New York Stock Exchange, Friday, May 8, 2015 in New York. Investors are
keeping a close eye on upcoming US jobs figures for signs of growth in the world's largest
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