Nasdaq Composite hits new high
The three main benchmarks rose by aroudn 1.8%
Dana Inc climbs after agreeing to merger automotive business with UK engineer, GKN
The Nasdaq Composite hit a new high and the Dow Jones average surged more than 400 points after surprisingly strong jobs numbers for February.
The Dow finished at 25,336, up 441 and the Nasdaq Composite closed at 7,561, up 133. The S&P 500 also had a bonanza day, rising 48 points to 2,786.
In corporate news, Dana Inc (NYSE:DAN) climbed 93 cents to US$27.14 after it agreed to merge its automotive business with that of British engineering company GKN.
READ GKN and Dana confirm US$6.1bn deal to merge automotive businesses, with new firm to be based in UK, listed in New York
Under the deal terms, GKN, which is fending off a hostile bid from smaller rival Melrose Industries, will receive cash proceeds of US$1.6bn, plus 133mln newly issued Dana shares - valued at about US$3.5bn based on its March 8 closing price - and will see the assumption of about US$1.0bn in pension liabilities in the merged business.
In Canada, the S&P/TSX Composite index hardened 39 points to close at 15,578.
Mid-session: Nasdaq hits a new high
The boost from February's surprisingly strong jobs report shows no signs of abating, with blue-chips extending earlier gains.
The Dow Jones average was up 369 at 25,265 and the S&P 500 was up 38 at 2,777. The Nasdaq Composite, meanwhile, was up 105 at 7,533, hitting a new high.
“In President Trump’s election campaign, he pledged to create more jobs that any other President and given the 806,000 created over the past year, he certainly appears to be well on his way to achieving this goal,” ob served Fiona Cincotta at spread betting firm City Index.
“There is a strong chance that Trump will look back across this week and feel rather pleased with himself: he signed off his steel and aluminium tariffs, February saw astronomical number of jobs created and he agreed to historical talks with North Korea. The Volatility index, or fear gauge is trading lower for the 6th straight session, suggesting the risk on trade is back on the table,” she added.
ShiftPixy Inc (NASDAQ:PIXY) was one of the top performers on the Nasdaq exchange, rising 43% to US$1.5.4348 after it announced it would base its Texas market launch in Austin.
The personnel management platform focused on the “gig economy” said Austin's thriving tech community made it the perfect place for it to launch in Texas.
Open: Stocks open higher after jobs gains outpace wages growth
US markets opened sharply higher after February's job report knocked one out of the park.
The Dow Jones average was up 182 points at 25,077 and the S&P 500 was 21 points higher at 2,760.
Non-farm payrolls rose by 313,000 in February, which was the biggest monthly gain since July 2016.
The unemployment rate remained unchanged at 4.1% for the fifth consecutive month as the labor force increased by 806k – the best monthly increase since January 2003.
“The February US employment report was very strong with robust job gains, rapid labor force growth, and a moderation in average hourly earnings growth that should quell concerns about accelerating inflationary pressures. It provides further evidence of improving US economic momentum that we expect will lead the Fed to raise its policy rate each quarter this year,” said Mickey Levy at Berenberg bank.
Wells Fargo said, “Another month of job and wage gains support the case for better growth (2.5-3.0 percent) for 2018 and continued consumer spending”.
“The long view remains for job gains to outpace labor force growth,” it added.
Pre-open: US non-farms payrolls "shattered expectations"
US indexes were set to storm higher on Friday after the release of non-farm payrolls data.
The Dow Jones average, which rose 94 points on Thursday to close at 24,895, was expected to open at around 25,061, up 166 points
The S&P 500, which advanced 12 points on Thursday to 2,739, was seen opening its account at around 2,755.35.
The US economy added 313,000 jobs in February, which was way higher than the 200,000 expected by economists.
Wage growth, however, was slower than expected, rising 2.6% on an annualized basis.
“The latest set of data for US jobs has shattered expectations, with non-farm payrolls increasing by 313,000 jobs last month; however, this time the real focus centres around wages,” suggested Dennis de Jong, the managing director of forex trading platform operator UFX.com.
“Indeed, after Fed chairman Jerome Powell raised fears of elevated interest rate forecasts only last week, any accompanying up-tick in wages would make a persuasive case for higher rates over the coming year,” de Jong said.
“However, with sustained wage growth yet to manifest itself, the Fed remains on track for Powell to persevere with his plan for gradual, incremental hikes … for now at least,” de Jong concluded.
Investors in toy makers Mattel Inc (NASDAQ:MAT) and Hasbro Inc (NASDAQ:HAS) were having no fund in pre-market trading after more bad news from fallen toys & games retailer Toys “R” Us.
The retailer is said to be preparing to liquidate all of its US stores and abandon its restructuring plans after a weak holiday season.
READ Weak holiday season force Toys ”R” Us Inc to liquidate US stores, give up restructuring plans - source
Report: Toys ‘R’ Us might shut down in U.S. https://t.co/2Ysd4quYaI
— The Daily Beast (@thedailybeast) March 9, 2018
Most big retailers that have gone bankrupt the past few years have one thing in common: They were all owned by private equity firms that loaded them up with debt. https://t.co/izw68AGuK2
— Marketplace (@Marketplace) March 8, 2018
Hasbro shares were down 2.9% at US$2.68 in pre-market trading while Mattel was even harder hit, down 5.4% at US$15.11.
Optical communications company Finisar Corporation (NASDAQ:FNSR) was down 9.7% at US$18.21 as brokers reacted to its results, released last night.
Needham downgraded the stock to 'hold' from 'buy' after what it said was a “dismal” set of results, made worse by a downbeat tone as regards the trading outlook.
The company's fiscal third quarter revenues were flat at US$332.4mln and the gross margin declined to 26.5% from 29.0%.