[New York Stock Market] Nasdaq Up 2.28% Awaiting Employment Report... Oil Price Recovers to $100

[Image source=Reuters Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] Major indices on the U.S. New York Stock Exchange continued their rally on the 7th (local time). Investors are awaiting the Labor Department's employment report to be released the next day. International oil prices rebounded on concerns over potential global supply constraints, recovering above $100 per barrel.

On the day at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 31,384.55, up 346.87 points (1.12%) from the previous session. The S&P 500, focused on large-cap stocks, rose 57.54 points (1.50%) to 3,902.62, while the tech-heavy Nasdaq index gained 259.49 points (2.28%) to close at 11,621.35.

Energy stocks led the gains. With oil prices rebounding, recent losses were recovered. ExxonMobil rose 3.17% from the previous close. Occidental Petroleum increased by 3.39%, and Marathon Oil closed up 5.56%. Schlumberger (+5.04%), Chevron (+1.89%), and Devon Energy (+5.24%) also saw their stock prices jump.

Freeport-McMoRan and Newmont rose 6.72% and 4.32%, respectively, as commodity inventories increased. GameStop surged more than 15% after its board approved a 4-for-1 stock split.

Following Samsung Electronics of Korea’s earnings report boosted by strong memory chip sales, chip manufacturers also rallied on the New York Stock Exchange. AMD and Nvidia rose 5.24% and 4.81%, respectively, on expectations of semiconductor industry improvement. Leading tech stocks such as Tesla (+5.53%), Microsoft (+0.82%), Meta Platforms (+1.43%), and Apple (+2.40%) also showed upward momentum.

Investors are expected to gauge the Federal Reserve’s future moves through the employment report released the following day. Tom Essaye, founder of Sevens Report Research, said, "The key to tomorrow’s employment report is the peak of inflation and the peak of the Fed’s hawkish stance. If the report reflects these two realities, it will spur a relief rally." The current market consensus is for an increase of 250,000 jobs.

The weekly initial jobless claims released on the day continued to rise. The U.S. Labor Department reported that weekly initial jobless claims increased by 4,000 to 235,000, exceeding the market forecast of 230,000.

Jonathan Golub, Chief U.S. Equity Strategist at Credit Suisse, stated, "Given layoffs and hiring freezes in the tech sector, recent ISM manufacturing and services sector readings below the 50 benchmark, and the increase in jobless claims?albeit at very low levels?the employment report to be released on Friday will be particularly significant."

However, despite the slowdown in employment, the Fed has repeatedly confirmed its intention to tolerate economic slowdown to curb inflation, so the rate hike trend is expected to continue. The minutes of the June Federal Open Market Committee (FOMC) meeting released the previous day included the statement that "a more restrictive stance may be appropriate if inflation rises."

In the New York bond market, the yield on the U.S. 10-year Treasury note recovered to the 3% range. However, the inversion where the 10-year long-term yield remains below the 2-year short-term yield continues. Such long- and short-term yield inversion is generally regarded as a precursor to a recession, fueling market concerns. Goldman Sachs lowered its U.S. GDP growth forecast for the second quarter to 0.7%.

The Chicago Board Options Exchange (CBOE) Volatility Index (VIX), known as Wall Street’s "fear index," fell more than 2% to trade around the 25 level.

International oil prices rebounded. On the New York Mercantile Exchange (NYMEX), August delivery West Texas Intermediate (WTI) crude oil closed at $102.73 per barrel, up 4.3% ($4.20) from the previous day. This marked a recovery above the $100 level just two days after fears of a recession had pushed prices below that threshold.

Gold prices rose as the recent strength of the U.S. dollar, which had been weighing on prices, somewhat eased. On the New York Commodity Exchange, August delivery gold closed at $1,739.70 per ounce, up 0.2% ($3.20).