Nasdaq hits fresh record high as blowout US jobs report cheers markets - as it happened

Graeme Wearden

from on 2018-03-12 20:06 (#3HYAW)

All the day's economic and financial news, as shares rise in Asia and Europe and the US...but house prices fall in the UK capital

8.06pm GMT

Boom! New York's stock market has closed for the day, with the Nasdaq at a fresh record high.

The tech-dominated index finished 28 points higher at 7,588, up 0.4%.

Dow closes more than 150 points lower amid lingering trade-war worries https://t.co/M5y1NkKanX pic.twitter.com/U1TOOvxq0x

7.35pm GMT

Speculation is growing the CNBC columnist Larry Kudlow could be in line to become Donald Trump's new chief economic advisor.

Jim Cramer, the famously enthusiastic CNBC presenter, got the ball rolling today by declaring that Kudlow was the leading contender for the seat vacated by Gary Cohn last week.

BREAKING: Larry Kudlow is the leading contender to replace Gary Cohn as NEC chair, reports our @jimcramer @CNBC @larry_kudlow

6.41pm GMT

Back in the City, engineering group GKN has formally rejected this morning's final takeover from Melrose.

Having pondered Melrose's latest offering (officially worth 8.1bn in cash and shares), GKN has concluded that it still "fundamentally undervalues" it.

"As shareholders in both Melrose and GKN, we favour Melrose's proposed measured execution of value rather than GKN's reactive review of its business structure. Consequently, we believe the interests of shareholders in both companies are best served by accepting Melrose's raised bid."

4.41pm GMT

As European stock markets close for the day, the FTSE 100 index is down slightly at 7,208, a drop of 0.2%.

Germany's DAX had a better day, up 0.5% in late trading, helping keep the Europe-wide Stoxx 600 in the green.

2.48pm GMT

Mirio Centeno, the new head of the Eurogroup of finance ministers, has given Athens a vote of confidence at today's meeting in Brussels.

I had a friendly discussion with Greek finance minister Euclid @tsakalotos earlier today. #Greece is making remarkable progress in implementing the programme pic.twitter.com/aPHtKBFjIB

2.45pm GMT

Fawad Razaqzada, market analyst at Forex.com, says investors have rediscovered their appetite for risk today - pushing shares up and propelling the Nasdaq index of tech-focused shares to today's all-time high.

Sentiment improved last week as concerns eased over: (1) nuclear threats from North Korea, (2) the prospects of a trade war, (3) the possibility of sooner-than-expected tightening of monetary conditions in the Eurozone and Japan, and (4) the US economy.

All of a sudden there was unexpected urgency from North Korea to denuclearize and US President Donald Trump has agreed to meet the nation's leader Kim Jong-un face-to-face by May. This sharply reduced the appeal of safe haven assets like gold and yen, boosting risk-sensitive assets across the board.

2.26pm GMT

Today's market rally suggests that investors are less worried about a global trade war breaking out - even though president Trump approved steel and aluminium tariffs last week.

The issue hasn't gone away, though. Over the weekend, Trump suggested he could impose higher levies on European cars - something that would cause major tensions in the EU. He's now tweeted that he's pushing Europe to cut their tariffs on American goods.....

Secretary of Commerce Wilbur Ross will be speaking with representatives of the European Union about eliminating the large Tariffs and Barriers they use against the U.S.A. Not fair to our farmers and manufacturers.

2.22pm GMT

Consumer stocks, technology companies and telecoms firms helped drive the Nasdaq to a new peak of 7,144 points today.

Chipmakers are doing pretty well, with Micron up 6%, Broadcom gaining 3% and NVIDIA rising by 2.5%.

1.56pm GMT

Ding ding! The Nasdaq index has hit a fresh record high, as trading gets underway on Wall Street.

Shares are rising as the optimism from last week's strong jobs report lingers at the New York stock exchange.

1.46pm GMT

Reuters ran a great profile of David Solomon back in 2011, which is worth reading today now he's seemingly inked in for the top job at Goldman. It's online here.

Here's a flavour:

The 49-year-old co-head of Goldman Sachs' (GS.N) investment banking unit is an unassuming banker who moved into junk bonds early in his career and stayed in underwriting, even as other Wall Street businesses grew hotter.

He has been promoted into ever-more senior roles, and now works mostly behind the scenes, making sure that investment banking clients get what they need, that employees are happy and that Goldman's deal-making machinery operates smoothly. He has been behind some spectacular deals, even if he is not famous for them, and some clients view him as one of the best bankers in the business.

As David Solomon is named CEO-in-waiting at Goldman Sachs, it's worth revisiting this prescient story by the ever-awesome @LaurenLaCapra https://t.co/OzlclAgBr6

1.27pm GMT

Newsflash from Wall Street: Goldman Sachs has just given us a massive hint about who'll succeed Lloyd Blankfein as their chief executive.

Goldman has announced that one of its co-presidents, Harvey Schwartz, is retiring. Fellow co-president David Solomon, Schwartz's rival for the top job, will now serve as the "sole president".

MORE: David Solomon will become sole president of Goldman, putting him in line as the successor to CEO Lloyd Blankfein. Harvey Schwartz will retire from the firm https://t.co/LfBk5idFC3 pic.twitter.com/Bw4LGL2wej

Harvey has been a mentor to many, and his influence has made an indelible impact on generations of professionals at Goldman Sachs. I want to thank Harvey for all he's done for the firm."

"I look forward to continuing to work closely with David in building our franchise around the world, serving our expanding client base and delivering strong returns for our shareholders."

It's the @WSJ's announcement...not mine. I feel like Huck Finn listening to his own eulogy.

Soloman wins. pic.twitter.com/xz5hEpu9Tc

Also can you imagine what went down at Goldman over the weekend?

11.59am GMT

The Institute of Directors has also revealed that more than a dozen employees came forward with allegations against the IoD's chair.

Stephen Martin, the organisation's director general, revealed a string of staff came forward to give evidence when it launched a probe into the allegations against Lady Barbara Judge - whose resignation following claims she made racist and bullying comments has plunged the business lobby group into crisis.

"We could not shy away from this duty, particularly given over a dozen staff came forward with allegations. This showed real courage and real strength from those employees."

"I believe in the organisation's mission to promote good corporate governance. Despite the events of the last few days, I still believe in this mission, if anything, I believe in it more than ever,"

11.49am GMT

The prime minister of Malta is warning UK business leaders that Brexit will hurt the British economy.

Speaking at the Institute of Director's "Open House" conference in London, Joseph Muscat is warning that the end result of Brexit can't be better than EU membership.

Joseph Muscat (Prime minister of Malta) sharing his views on #brexit #iodOpenhouse pic.twitter.com/hgmKALuFAV

11.19am GMT

Just in: Another 78 workers at collapsed outsourcer Carillion have lost their jobs.

10.19am GMT

The US stock market is expected to rally today, as traders remain upbeat following last Friday's strong jobs data.

The Dow Jones industrial average is being called up around 100 points, or 0.4%, to 25,437 points, adding to Friday's 440-point jump.

Investors were greeted with a blockbuster non-farm number AND a worse than forecast wage growth reading, a combination that allowed the markets to celebrate the US economy without having to fear the hawkish implications of an earnings increase.

Dow futures point to triple-digit gains at the open after jobs report https://t.co/dL4CupXCKL

9.58am GMT

Takeaway app group Just Eat has slumped by over 4% this morning, to the bottom of the FTSE 100, after a downgrade from Deutsche Bank.

Whilst the food delivery giant has had a phenomenal rise over the past few years, concerns the success story might be coming to an end are refusing to budge.

Just last week JustEat announced 2017 losses of 76 million compared to pre-tax profits of 91 million, coupled with today's downgrade and market participants are looking elsewhere to invest their cash.

9.39am GMT

Credit card company Visa has reported that UK consumers cut back on credit last month -- a sign that Britain's economy remains fragile.

Household finances are still being squeezed from every direction and there appears to be no immediate end in sight. Wages aren't rising fast enough to keep up with prices, borrowing looks likely to increase with another interest rate rise, and there remains a lot of uncertainty around what the reality of Brexit is going to be.

8.52am GMT

Shares in Britain's GKN have jumped by 2% this morning as the takeover battle for the long-established engineering firm took another twist.

On the one hand you can join us on a journey of value creation by investing in a UK listed manufacturing powerhouse worth over 10 billion today and receiving 1.4 billion of cash.

On the other hand your Board is attempting a hasty fire-sale of GKN businesses before they have been given a chance to reach their potential and with damaging consequences, we believe, for all stakeholders.

8.29am GMT

A solid start to the trading week in Europe:

8.14am GMT

European stock markets are joining the rally, as a new trading week dawns.

The 313,000 additional jobs took economists and markets by surprise as the figure exceeded even the highest expectations of 300,000 noted in a Reuters survey. Although employees may not like the 0.1% rise in average hourly earnings, employers liked it and markets loved it.

This is simply because the modest increase in wage growth indicates that the Federal Reserve will continue to have some sort of slack in the labour market to deal with and thus keep the Fed on course for three rate hikes in 2018 instead of four. After all, the combination of robust economic data and limited inflation has been a key factor in keeping the bull market alive.

8.11am GMT

London's housing market looks particularly soggy when compared to Lancashire.

Prices in the North West have gained 4.6% in the last year, including a 16% surge in Blackburn and a 10.3% rise in Warrington.

7.59am GMT

This chart from Bloomberg shows how London's housing market is now lagging the rest of the UK.

London prices fell 0.8% in January alone, equivalent to almost 5,000 pounds, showing the weakness that was present for much of last year continued into 2018. The market has been hurt by slower growth and faster inflation since the Brexit vote, while the Bank of England has signaled it needs to continue raising interest rates.

7.50am GMT

House prices in parts of London that were once at the epicentre of the UK property boom have fallen as much as 15% over the past year, in fresh evidence of the impact of the EU referendum.

7.40am GMT

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

Investors are in confidence mood this morning, after the latest US jobs report smashed forecasts.

European Opening Calls:#FTSE 7239 +0.20%#DAX 12423 +0.62%#CAC 5307 +0.61%#MIB 22875 +0.57%#IBEX 9753 +0.69%

A relief rally boosted Asian stock markets overnight, after Friday's US jobs report hit all the right notes. The impressive number of jobs created versus the weaker than forecast wages data meant that the strengths and weakness of the report whetted risk appetite perfectly.

The economy is clearly booming but future inflation concerns have eased following January's report, allowing the stock markets to charge higher.

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