ETFs are starting off December with a strong rally Wednesday as investors welcome a fresh start. Markets around the globe are cheering strong economic data from China and Europe. On top of that, solid economic reports from the United States are adding to the bullish momentum.
- Global markets are leading the charge in early trading, with ETFs aimed at India, Poland, Spain and Eastern Europe powering ahead; most funds are up nearly 4% or more, led by Market Vectors India Small-Cap (NYSEArca: SCIF), which is up well over 5%.
- Private-sector employment posted its biggest monthly jump in three years, according to Automatic Data Processing Inc.’s latest report. Private-sector employment rose by 93,000 in November, the largest jump in three years, but the gain was too small to lower the unemployment rate, according to an Automatic Data Processing Inc. employment report released Wednesday. While November’s report shows an acceleration in employment, larger gains would be needed to lower the unemployment rate of 9.6%, according to Joel Prakken, chairman of Macroeconomic Advisers, which computes that data using anonymous payroll data collected by ADP. Aided by the improvement, the NASDAQ is surging this morning; PowerShares QQQ Trust (NASDAQ: QQQQ) is up more than 2%.
- Productivity growth in the U.S. workplace accelerated during the third quarter to 2.3%, up from 1.9% estimated a month ago, as output powered ahead in line with the pickup in gross domestic product, the Commerce Department said Wednesday. However, productivity is still below the 3.5% annual rate hit in 2009. If this pattern holds, companies might start to hire more workers. The latest GDP report included a much stronger gain in wage and salary income this year than previously estimated. As a result, second-quarter unit labor costs were revised to a 4.6% gain from the prior estimate of a 1.1% increase – as reported by MarketWatch.
- Asian and European stocks are also on the rise this morning, buoyed by a string of strong economic data. China’s official manufacturing purchasing managers’ index rose to 55.2 in November from 54.7 in October, according to reported data released by the China Federation of Logistics and Purchasing. The increase marked the 21st-straight month of expansion in manufacturing activity and came in ahead of economists’ forecast for a 54.7 reading, according to Reuters. A reading above 50 shows an expansion in manufacturing, while one below 50 represents contraction. iShares MSCI All Country Asia ex-Japan (NYSEArca: AAXJ) is up nearly 2.5% so far today.
- MarketWatch reported that manufacturing activity in Great Britain accelerated at the fastest pace in 16 years in November, boosted by a strong rise in orders, according to a monthly survey of purchasing managers released Wednesday. The CIPS/Markit purchasing managers’ index jumped to 58.0, its highest level since September 1994. Economists had forecast a reading of 54.7. The output index rose to a six-month high and new orders increased, boosted by domestic and export demand. iShares MSCI United Kingdom (NYSEArca: EWU) is up 2% so far today.
Gregory A. Clay contributed to this article.
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