Market Update: Investors tread cautiously ahead of US monthly jobs release – 06.09.2013

Source: Henderson Global Investors

Thursday saw US markets finish on a moderately positive note. With employment being a key factor in the Federal Reserve’s (the Fed) decision to pare down its asset purchases (tapering), analysts have been carefully watching job data releases. Initial jobless claims for the previous week fell more than analysts expected; today the all-important August non-farm payrolls employment report is due. In addition, other data supportive of Fed tapering included a less-than-expected decline in July factory orders and a sharp rise in the Institute for Supply Management’s non-manufacturing index, which increased from 56 to 58.6 in August. In the bond markets, supportive tapering data helped benchmark US 10-year Treasury yields rise above the psychological 3% threshold. The S&P 500 climbed 0.1%, the Nasdaq was up 0.3% while the Dow was flat.

In Europe, the FTSE Eurofirst 300 and the FTSE 100 are barely changed at the time of writing. In London, mining companies such as BHP Billiton, Anglo American and Randgold Resources are in the red as risk appetite is low ahead of the US jobs release. Meanwhile, British industrial output for July was flat and the goods trade deficit widened by more than expected, to £9.85bn.