2023-09-01 21:56:01
The high unemployment rate in America supports the US stocks… and the Dow Jones adds 115 points
Recent government data showed that the unemployment rate in America rose to the highest level in a year and a half, so the US stock market celebrated, hoping that the Federal Reserve would stop raising interest rates, but the gains were curtailed before the end of trading on Friday, due to profit-taking operations, following four days of increases.
By the end of trading on the first day of the new month, the Dow Jones Industrial Average was up by 0.33%, representing 115 points, and the S&P 500 index rose by 0.18%, while the Nasdaq index remained close to the point at which the day began, but in the red zone.
And the US Bureau of Labor Statistics reported Friday that non-farm payrolls increased by 187 thousand during the month ended, exceeding expectations that stopped at 170 thousand. He pointed out that the unemployment rate in America rose in August to 3.8%, despite the addition of large jobs.
Investors viewed the data as supportive of the possibility of halting interest rate hikes, as the Federal Reserve considered on several occasions that the high unemployment rate supports its efforts to combat inflation.
In Europe, stocks fluctuated following the announcement of the US jobs data, before ending Friday’s trading at almost the same point at which it began, albeit with the lowest rate of decline that might be recorded (0.01%).
Shares of oil and gas companies rose 1.9%, following analysts raised their forecasts for oil prices in 2023 for the first time in four months, according to a Archyde.com poll conducted on Thursday.
In a related way, shares of auto companies fell by 2.6%, following another survey, conducted by the German Ifo Institute, indicated a deterioration in sentiment among automakers. Nearly half of those surveyed said a lack of orders was hampering production.
On Friday, oil prices rose to their highest levels in more than seven months, ending two weeks of losses, supported by expectations of supply shortages and continued Saudi production cuts.
Several reports indicated widespread expectations that Saudi Arabia would extend its voluntary production cut by one million barrels per day in October, prolonging supply restrictions announced by the Organization of the Petroleum Exporting Countries (OPEC) and its allies in the bloc known as OPEC + to support prices.
Russian Deputy Prime Minister Alexander Novak said Thursday that his country, the second largest oil exporter in the world, has already agreed with its partners in OPEC + to reduce oil exports next month.
Brent crude rose $1.66, or 1.9%, to settle at $88.49 a barrel. It had risen during the session to $88.75 a barrel, the highest level since January 27.
US West Texas crude increased $1.39, or regarding 1.7%, to $85.02 a barrel. It rose earlier to $85.81, its highest level since November 16.
The price of Brent crude rose regarding 4.8% this week, recording the largest weekly increase since late July. And the price of US West Texas crude rose 7.2%, in its largest weekly gain since March.
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