[Asia Economy New York=Special Correspondent Baek Jong-min] The New York stock market rose amid strong employment data, expectations of economic stimulus, and weak GameStop stock prices. The rise in U.S. Treasury yields highlighted the strength of the dollar and the weakness of gold.
On the 4th (local time), the Dow Jones Industrial Average closed up 332.26 points (1.08%) at 31,055.86, the S&P 500 rose 41.57 points (1.09%) to 3,871.74, and the Nasdaq increased 167.2 points (1.23%) to 13,777.74.
GameStop stock, which had slightly rebounded the day before, plunged again by 42%. Most stocks mainly bought by individual investors, such as AMC, KOS, and Express, also fell sharply.
U.S. Treasury Secretary Janet Yellen convened a meeting to discuss the sharp fluctuations in GameStop stock prices. On the same day, Yellen appeared on ABC News and said she was closely reviewing the current situation, stating, "We will ensure that financial consumers are protected. We will also check whether additional actions are necessary."
The employment data released that day lifted the market. The Department of Labor announced that the number of initial jobless claims last week decreased by 33,000 from the previous week to 779,000. This marked the third consecutive week of decline and was below the Dow Jones consensus estimate of 830,000.
Due to strong employment data and accelerated legislative procedures for the economic stimulus bill, U.S. Treasury yields showed an upward trend. The 10-year U.S. Treasury yield rose to 1.16% during the session. As bond yields increased, financial stocks showed strong gains, rising by 2.28%.
The rise in Treasury yields also boosted the value of the dollar. On the day, the dollar index rose 0.5% from the previous day to 91.55.
The rise in the dollar's value acted as a factor in the decline of gold prices. April delivery gold closed at $1,791.20 per ounce, down 2.4% ($43.90) from the previous day, breaking below the $1,800 level. This was the lowest closing price since late November last year. March delivery silver also closed down 2.4% ($0.65) at $26.234 per ounce.
On the same day, Raphael Bostic, President of the Federal Reserve Bank of Atlanta, reassured the market by stating that the Fed is not expected to begin tapering (reducing bond purchases) this year.
March delivery West Texas Intermediate (WTI) crude oil closed up 1% ($0.54) at $56.23 per barrel despite the strong dollar.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
