6/2/09

The Dow Jones gained 106.41 points to close at 8,063.07, the S&P 500 added 13.62 points to end at 845.85. The Nasdaq climbed 31.19 points to finish at 1,546.24.

Banks were among the top performers although demand cooled later in the session - the KBW bank index finished up 1.8%, having earlier been as much as 6.8% higher. JPMorgan Chase advanced 2.1% while Bank America rose 3%. 

Wal-Mart Stores Inc led the Dow higher as discount retailers continued to benefit from the current economic climate. Sales rose 2.1% in January, beating its own forecasts and sending shares 4.6% higher. Other retailers were not so buoyant, Abercrombie & Fitch said sales fell 20% last month and Nordstrom reported an 11.4% slide.

Akamai Technologies gave the Nasdaq a boost after posting quarter profit and revenue that beat expectations - shares rallied 18.1%. Cisco Systems climbed 3% after reporting figures late Wednesday that beat estimates.

US light crude oil for March delivery rose $0.85 to $41.17 a barrel. COMEX gold for April delivery climbed $12 to $914.20 an ounce. Treasury prices went higher, lowering the yield on the 10 year note to 2.89% from 2.94%.

The Nikkei rose 126.97 points to close at 8,076.62 this morning as a weaker yen lifted the earnings prospects for makers of cars and electronic.

The Hang Seng jumped 476.04 points to close at 13,655.04 this morning on speculation the US will announce a plan to ease its financial crisis and after a newspaper reported that Chinese banks will be allowed to reduce lending rates.

January non farm payrolls are expected to decline by 450,000. In addition to benchmark revisions to the March 2008 payrolls level this report will include updated seasonal factors and net business birth/death adjustments, as well as the normal revisions to the November and December data. These factors could impact the recent history of payrolls, which has fallen by 484,000 on average for the past four months. The 4 month averages for ADP employment (-432,000) and summed state employment (-498,000) are in the same ballpark, but both alternative measures show a sharper deterioration in the past two months that has not been as evident in the non farm series, with job losses in November and December being two to three times as large as in September and October.

The preliminary estimate of the benchmark revision was -21,000, with -81,000 estimated for private payrolls and +60,000 estimated for government jobs. The biggest benchmark revision in recent history came two years ago, when the March 2006 level of payrolls was revised higher by 752,000. Last year, the revision to the March 2007 level was more typical at -293,000.

The report will also include updated population controls for January, without affecting data for earlier months. Last year, the revision reduced the civilian non-institutional population by 745,000, but there was no net impact on the unemployment rate as labour force and employment levels were reduced proportionally. Assuming no major revisions this time around, the unemployment rate is expected to rise to 7.5 percent, up from 7.2 percent in December.

Average hourly earnings have risen by 0.3 percent for the past three months. The most pronounced increases have occurred in the professional and business services category, averaging 1 percent per month since October. This industry group includes temporary workers and may be reflecting the impact of lower wage employees being laid off first. These above trend increases are unlikely to persist for long, and January hourly earnings are expected to rise 0.2 percent, taking the year on year rate to 2.6 percent from 3.7 percent.

US Consumer credit (Dec) 20.00 gmt