Saturday 8 June 2013

Stocks jump on positive economic data

Stocks ended the week on a strong note. Both the S&P 500 and the STOXX Europe 600 rose 1.3 percent on Friday.

Earlier on Friday, Asian stocks had been little changed. The Nikkei 225 pared early losses to finish just 0.2 percent down.

Positive economic data throughout the day helped to buoy investor sentiment.

Japan started the day by reporting that its index of coincident economic indicators rose a preliminary 1.0 point in April. The index of leading economic indicators rose 1.3 points.

Later, Germany reported that its exports jumped 1.9 percent in April while its imports surged 2.3 percent.

This was followed by a report that showed that German industrial production jumped 1.8 percent in April, the third consecutive increase and the strongest gain since March last year.

Economic data from the UK on Friday were less positive. The trade deficit narrowed in April but only because a 3.8 percent decline in imports overwhelmed a 1.4 percent decline in exports.

The report that probably moved stocks the most on Friday, though, was the US employment report. That showed that employment in the US rose by 175,000 in May. That was better than the 163,000 median forecast from a Bloomberg survey and the 149,000 increase in April.

The unemployment rate nevertheless climbed to 7.6 percent from 7.5 percent as a result of a surge in the number of people entering the labour force.

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