US stocks retreat as small caps decline before earnings

US stocks fell as small-cap shares resumed a selloff and investors awaited the  start  of  corporate  earnings  season  to  assess  the  strength  of  the economy.  The S&P 500 fell 0.2%  to 1,964.84. The Dow  Jones Industrial Average retreated 17.72 points (0.1%) to 16,991.97.

Fed’s labor market conditions index strengthens

A  Federal  Reserve  index  showed  that  the  US  labor  market  improved  in September.  The  Labor  Market  Conditions  Index,  derived  from  19 indicators,  rose  by  2.5  points  in  September  after  gaining  2  points  in August,  according  to  data  released  by  the  Fed.  Fed  Chair  Janet  Yellen, who cited the index in an Aug. 22 speech to the Fed’s annual symposium in  Jackson  Hole,  has  broadened  her  assessment  of  the  labor  market  to better measure how much slack remains as unemployment declines.

Hiring surge puts US jobless rate at six-year low

A surprisingly powerful surge in hiring pushed unemployment to a six-year low  of  5.9%  in  September  from  6.1%  in  August  as  the  US  labor  market showed  renewed  vigor.  The  248,000  gain  in  payrolls  followed  a  180,000 increase  in  August  that  was  bigger  than  previously  estimated,  the  Labor Department reported. The median forecast of 100 economists surveyed by Bloomberg projected payrolls would increase by 215,000.

IMF urges clear communication to avoid ‘taper tantrum’ repeat

Central  bankers  in  advanced  economies  must  clearly  communicate  their plans  to  unwind  monetary  stimulus  to  avoid  a  repeat  of  the  volatility unleashed  in  emerging  markets  in  2013,  International  Monetary  Fund (IMF) said. “Surprises about the future course of monetary policy in major advanced economies have particularly strong effects on emerging-market asset  prices  and  capital  flows,”  IMF  said  in  a  report  released.  “It  is therefore important for advanced-economy central banks to provide clear communication and adequate market guidance.”

German factory orders slump most since 2009

German factory orders plunged the most since 2009, underlining the risk of a  slowdown  in  Europe’s  largest  economy.  Orders,  adjusted  for  seasonal swings and inflation, fell 5.7% in August  from  a 4.9% increase in July, the Economy Ministry said. Economists predicted a 2.5% decline, according to the median estimate in a Bloomberg News survey.

World Bank cuts Developing East Asia 2015 GDP forecast

The World Bank lowered its forecasts for growth in developing East Asia this  year  and  next  as  China’s  expansion  moderates  and  policy  makers brace for tighter global monetary conditions.  The region is forecast to grow 6.9% in 2014 and 2015, down from 7.1% projected in April, the lender said in its East Asia and Pacific Economic Update released. China will expand 7.4%  this  year  and  7.2%  next  year,  compared  with  7.6%  and  7.5% previously forecast, the report showed. The world’s growth is forecast to be 2.6% in 2014, and an average of 3.3% from 2015 to 2017, it said.

Brent crude pulled higher by rebound in gasoline futures

Brent oil rebounded from a 27-month low on speculation prices decreased more  than  justified.  Brent  for  November  settlement  rose  US$0.48  to  end the session at US$92.79 a barrel on the ICE Futures Europe exchange.

Source: Bloomberg