Tech Leads Stock Losses While Treasuries Advance

Stocks almost wiped out their gains as technology shares turned lower, offsetting optimism over solid corporate earnings and economic reports. Treasuries climbed. The S&P 500 rose by 0.07% to 4,167.59 while Dow Jones was up 97.31 points (0.29%) to 34,230.34.

Services in US Expand at Second-strongest Pace on Record

US service providers expanded in April at the second-fastest pace in data back to 1997, cooling slightly from the prior month as business activity and order growth pulled back from record highs. The Institute for Supply Management’s services index unexpectedly fell to 62.7 last month from a record 63.7 in March. Readings above 50 signal growth.

White House Says Businesses Having to Hike Wages Is ‘good Thing’

The US economic reopening has caused some “bumps” as companies scramble to fill open positions, but it’s a good thing if they are forced to raise wages, a senior White House aide said. “When we are hearing stories of businesses having to raise wages in order to attract workers back, that is a positive development, especially for lower income folks in this country,” said NEC’s deputy director Bharat Ramamurti.

Spain to Enact New Labor Laws by Early 2022 in Jobs Boost Drive

Spain intends to have new labor laws in place by early next year to ease the creation of hundreds of thousands of jobs while its economy recovers from the pandemic. Economy Minister Nadia Calvino noted that their goal is to have a new labor-market framework by the beginning of 2022 that helps to ensure strong growth in quality jobs, with greater productivity and better salaries.

London Emerges From Lockdown Harder Hit Than Much of the UK

London is emerging from lockdown bruised by Brexit and a pandemic that hit UK capital harder than other regions, raising questions about its ability to power the country’s economic recovery. The city accounts for a quarter of UK output and suffered almost 30% of the drop in payrolls nationwide in the past year. People are moving to the suburbs and beyond in search of space, and Britain’s exit from EU is draining away high-paying work in finance.

Thailand Holds Rates, Warns on Growth Amid Worst Covid Wave

BOT kept its benchmark interest rate unchanged for an eighth straight meeting, warning that its forecast for economic recovery was threatened by the country’s biggest virus wave since the pandemic began. BOT held the policy rate at 0.5% in a unanimous decision. A flareup of Covid-19 that began in Bangkok nightlife venues has spread nationwide, more than doubling Thailand’s total caseload since early April.

Indonesia Aims for V-shaped Recovery After Disappointing GDP

Indonesia is setting its sights on a sharp turnaround starting this quarter as it assembles more stimulus programs to lift stubbornly weak domestic demand. GDP declined 0.74% in the first quarter from a year ago. Southeast Asia’s largest economy should return to growth this quarter as the government readies tax and sales measures to support the retail sector, said the Coordinating Minister for Economic Affairs.

Oil Rally Pauses as Investors Weigh Rising Gasoline Supplies

Oil was little changed, giving up earlier gains as traders assessed an increase in gasoline stockpiles and technical signals suggesting the commodity’s rally was due for a pullback. Brent crude for July settlement rose US$0.08 to US$68.96 per barrel.

Source: Affin Hwang Research - 6 May 2021