Dow Average Hits Record Before Jobs Data

Stocks climbed as data showing the world’s largest economy is strengthening overshadowed inflation worries, with investors awaiting jobs report. The dollar retreated. The S&P 500 rose by 0.82% to 4,201.62 while Dow Jones was up 318.19 points (0.93%) to 34,548.53.

US Jobless Claims Fall More Than Forecast to Pandemic Low

Applications for US state unemployment insurance fell last week to a fresh pandemic low as labor market conditions continued to improve and the economy reopened more broadly. Initial claims in regular state programs fell by 92,000 to 498,000 in the week ended May 1. The prior week’s figure was revised up to 590,000. The job market is strengthening as employers look to fill positions left empty by the pandemic.

Job Openings at US Small Businesses Increase to Fresh Record

A record share of US small-business owners reported unfilled positions in April, and firms are offering higher wages to lure workers. Some 44% of firms had job openings last month, and 59% of owners reported adding workers or trying to hire. Almost onethird of small businesses raised compensation, the largest share in more than a year, and more companies said they plan to raise worker pay.

German Factory Orders Rise as European Economy Turns Corner

German factories saw demand rising for a third month in March, underscoring the resilience of the country’s manufacturing sector in the face of extended coronavirus lockdowns. Orders increased 3%, twice the pace forecast in a Bloomberg survey. Demand for machinery, data processing equipment, electrical and optical goods as well as car manufacturing was particularly strong.

BOE Foresees Biggest UK Spending Boom Since Thatcher Era

The Bank of England expects the biggest surge in household spending since 1988 when Margaret Thatcher was prime minister, to help power a strong economic rebound after the pandemic. Officials, led by Governor Andrew Bailey, said they expect consumers to use up 10% of the savings glut built during lockdowns. BOE sees the UK’s economic output recouping losses by the end of this year instead of in early 2022.

South Korea Sees Growing Economic Momentum Toward Full Recovery

South Korea sees growing momentum for a faster-than-expected economic recovery and seeks a complete exit from the pandemic slump this year, a senior official said. “If last year was about hanging in there, this year is about the economy rising back up for sure,” Vice Finance Minister Lee Eog-weon said. They’ll make sure policy will help maintain the momentum for recovery.

Philippines Sees Recent Lockdown Reversing a Jobs Recovery

The Philippines’ jobless rate fell in March to its lowest level since the pandemic began, but economic managers said a recent lockdown due to a new surge in Covid-19 cases will likely reverse job gains. The unemployment rate dropped to 7.1% in March from 8.8% in February. Some 2.2 million jobs were added, mostly in construction, retail and agriculture.

Oil Slips With Uneven Global Demand Rebound Tempering Rally

Oil declined as the coronavirus crisis in India and a slowing demand rebound in the US highlighted the uneven nature of the global recovery. Brent crude for July settlement slid US$0.87 to US$68.09 per barrel.

Source: Affin Hwang Research - 7 May 2021