Stocks Finish Mixed

June 5th, 2009 by BusinessWeek: Investing

U.S. stock index futures were sharply higher in premarket trading after the U.S. government at 8:30 am ET reported that nonfarm payrolls fell by 345,000 in May, a much smaller drop than the market expected. On a less positive note, May’s unemployment rate spiked to 9.4% from April’s 8.9%, topping market forecasts of 9.2%.

Dow Jones industrial average futures were up 97 points, S&P 500 index futures rallied 11 points, and Nasdaq 100 index futures gained 10 points after the data and ahead of the opening bell, off their best post-data levels.

Treasuries, the dollar index and gold futures were off. Oil futures were up.

U.S. nonfarm payrolls dropped 345,000, much better than expected (economists’ median forecast called for a 500,000 drop and the so-called market “whisper” number indicated a 475,000 decline) in May. In addition, April was revised up to -504,000 from -539,000 previously and March was revised up to -652,000 from -699,000. However, the jobless rate spiked to 9.4% (median 9.2%) from 8.9%. The average workweek dipped to 33.1 hours (median 33.2), vs. 33.2 hours in April. And hourly earnings rose a modest 0.1% (median 0.2%), matching April’s gain.

“The improvement in the headline number supports recent rotation into riskier assets — reinforcing expectations that the hefty declines of Q4 and Q1 are now diminishing, even as the economy continues to contract,” says Action Economics.

Mining stocks grabbed the spotlight Friday after Rio Tinto (RTP) scrapped a planned $19.5 billion deal with Chinalco and opted instead to raise $15.2 billion in a share sale and form a joint venture with rival BHP Billiton (BHP) to cut its debts.

In the financial sector, the FDIC is reportedly planning to reshuffle Citigroup (C) management from the top, helping boost the firm’s share price some 2%.

Apple Inc. (AAPL) gained after talk that CEO Steve Jobs will be returning from his extended medical leave.

NYMEX crude vaulted above $70 per barrel Friday, helping the energy sector, but a headwind for the rest of the market.

In markets elsewhere Friday, London, Paris, Frankfurt stocks were sharply higher. Tokyo stocks rose 1.02% and Hong Kong gained 0.96%, while Shanghai stocks fell 0.48%.

Stocks Finish Mixed
Stocks Finish Mixed

Stocks Finish Mixed

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