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Feb. US jobs figure could fuel stock market rally
Thu Mar 3, 2005 12:42 PM ET
NEW YORK, March 3 (Reuters) - A solid February U.S. jobs figure may provide the boost needed to push the Dow Jones industrials and the Standard & Poor's 500 to fresh highs, market strategists said on Thursday.
"There is a positive feeling ahead of the nonfarm payroll figures on Friday, which I don't think will disappoint," said Tom Hougaard, market strategist at City Index in London.
The U.S. Labor Department will release its employment report for February on Friday at 8:30 a.m. (1330 GMT). Analysts surveyed by Reuters expect it to show nonfarm payrolls added 220,000 jobs in the month, up from 146,000 in January.
The report is a closely watched measure of the economy's health and typically a stock market mover, but this one may provide enough of a push to send stocks skyward because both the Dow Jones industrial average and Standard & Poor's 500 Index have traded near key highs.
"We've got a decent broad market advance building here," Marc Pado, U.S. market strategist at Cantor Fitzgerald & Co., said. "The market loves to get a catalyst, and more often than not, it's the elimination of any possible negative.
"I think anything around the (analysts') expectation would open the door, and a positive surprise would be taken to heart and really allow the market to follow though," he said.
The Dow needs to close above 10,854.54, a closing 3-1/2 year high made on Dec. 28 and the S&P needs to close above its Dec. 30 closing high of 1,213.55, Pado said.
The Nasdaq Composite Index has lagged the other indexes, but a close above the key psychological 2,100 mark may provide fuel for more gains, he said.
Others say the jobs report must deliver a positive surprise, not just meet expectations, to spark a rally.
"If the figure falls between 180,000 to 230,000, it will be a nonevent for the markets," Paul Cherney, chief market analyst at Standard & Poor's, said.
"But if it's bigger than that, say 260,000 or higher, I think it would be sufficient to force buyers in off the sidelines and put a 3-to-5 day uptrend in place," Cherney said.
A close above the S&P's Jan. 3 intraday high of 1,217.90 would be a positive development, he said.
"We need good total volume, too. So far, when we've come up to this area, all we've seen is just regular sort of volume. The bigger volume would indicate that longer-term investors are making commitments to the long side."
On Thursday, a spike in crude oil prices pushed stocks lower. The Dow was down 23.72 points, or 0.22 percent, at 10,788.25 and the Standard & Poor's 500 Index was down 2.99 points, or 0.25 percent, at 1,207.09. The Nasdaq Composite Index was down 14.28 points, or 0.69 percent, at 2,053.22. (Additional reporting by Megan Davies and Michael Flaherty)
Feb. US jobs figure could fuel stock market rally
Thu Mar 3, 2005 12:42 PM ET
NEW YORK, March 3 (Reuters) - A solid February U.S. jobs figure may provide the boost needed to push the Dow Jones industrials and the Standard & Poor's 500 to fresh highs, market strategists said on Thursday.
"There is a positive feeling ahead of the nonfarm payroll figures on Friday, which I don't think will disappoint," said Tom Hougaard, market strategist at City Index in London.
The U.S. Labor Department will release its employment report for February on Friday at 8:30 a.m. (1330 GMT). Analysts surveyed by Reuters expect it to show nonfarm payrolls added 220,000 jobs in the month, up from 146,000 in January.
The report is a closely watched measure of the economy's health and typically a stock market mover, but this one may provide enough of a push to send stocks skyward because both the Dow Jones industrial average and Standard & Poor's 500 Index have traded near key highs.
"We've got a decent broad market advance building here," Marc Pado, U.S. market strategist at Cantor Fitzgerald & Co., said. "The market loves to get a catalyst, and more often than not, it's the elimination of any possible negative.
"I think anything around the (analysts') expectation would open the door, and a positive surprise would be taken to heart and really allow the market to follow though," he said.
The Dow needs to close above 10,854.54, a closing 3-1/2 year high made on Dec. 28 and the S&P needs to close above its Dec. 30 closing high of 1,213.55, Pado said.
The Nasdaq Composite Index has lagged the other indexes, but a close above the key psychological 2,100 mark may provide fuel for more gains, he said.
Others say the jobs report must deliver a positive surprise, not just meet expectations, to spark a rally.
"If the figure falls between 180,000 to 230,000, it will be a nonevent for the markets," Paul Cherney, chief market analyst at Standard & Poor's, said.
"But if it's bigger than that, say 260,000 or higher, I think it would be sufficient to force buyers in off the sidelines and put a 3-to-5 day uptrend in place," Cherney said.
A close above the S&P's Jan. 3 intraday high of 1,217.90 would be a positive development, he said.
"We need good total volume, too. So far, when we've come up to this area, all we've seen is just regular sort of volume. The bigger volume would indicate that longer-term investors are making commitments to the long side."
On Thursday, a spike in crude oil prices pushed stocks lower. The Dow was down 23.72 points, or 0.22 percent, at 10,788.25 and the Standard & Poor's 500 Index was down 2.99 points, or 0.25 percent, at 1,207.09. The Nasdaq Composite Index was down 14.28 points, or 0.69 percent, at 2,053.22. (Additional reporting by Megan Davies and Michael Flaherty)