A mixed report on job cuts and employment numbers sent stocks and exchange traded funds (ETFs) higher in morning trading.
U.S. employers cut a fewer-than-expected 216,000 jobs in August, confirming that the pace of layoffs is easing. In fact, the labor force as a whole increased by 73,000 indicating the return of some jobless workers who had given up looking for work, states the Associated Press. Although this is encouraging news, the total unemployment rate for the nation increased to 9.7%, after dipping to 9.4% in July.
The payroll and employment data further influenced the gold markets, sending the precious metal $990 an ounce after a two-day rally that took the shiny metal up to a hair from $1,000 an ounce. Gold has been benefiting from uncertainty over the strength of the economic recovery, with investors who see the recovery faltering buying the metal as a haven from risk, while those who believe it is sustainable choose the metal as an inflation hedge. The SPDR Gold Trust (GLD) was down 0.5% in intraday trading.
The crude oil markets felt the same effects as the gold markets as the volatile commodity fell on the most recent employment data, which further supported the notion that demand will remain weak even if the economy is heading out of a recession. The United States Oil Fund (USO) was down 1.2% in morning trading.
In different news, retail metrics indicated that same-sales store sales dropped 2.3% in August, beating analysts’ expectations of a drop of 3.4%. The sector was driven by the performance of discount retailers as consumers looked for bargains for back-to-school shopping and their essentials. The Retail HOLDRs (RTH) was up 0.2% in morning trading.
Overall, the Dow Jones Industrial Average added 0.3%, while the S&P 500 jumped 0.4% and the Nasdaq gained 0.6% in morning trading.
For more stories on retail, visit our retail category.
Kevin Grewal contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.