Markets today: Stocks climb as jobs data quell economic jitters

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Stocks rose and bonds fell after the latest labour-market reading helped ease fears about a more pronounced economic slowdown.

BNN Bloomberg's Jon Erlichman looks at how North American markets are shaping up for the trading day.

Equities rebounded sharply as data showed U.S. initial jobless claims tumbled by the most in nearly a year, with the numbers also coming below estimates. As economic angst subsided, Treasuries dropped across the curve. While swap traders have reduced their bets on jumbo rate cuts, they are still pricing in about 40 basis points worth of easing for September.

To Ian Lyngen at BMO Capital Markets, the jobless claims data is being interpreted as evidence the labour market remains solid. All major groups in the S&P 500 gained, with the benchmark up about one per cent. The Bloomberg “Magnificent Seven” gauge added 0.7 per cent. The Russell 2000 of smaller firms climbed 1.1 per cent. Eli Lilly & Co. soared 13 per cent on a bullish outlook. Treasury 10-year yields advanced six basis points to four per cent. The U.S. dollar was little changed.

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