Week
Ended February 3, 2012
Stocks
recorded a week of strong gains as investors welcomed positive data on the
labor market. The technology-oriented Nasdaq closed in on an 11-year high,
while the broader indexes moved back to their post-crash peaks in the spring of
last year. Markets saw good gains on Wednesday, in response to an encouraging
estimate of job gains from payroll processing firm ADP, but the real surge
followed Friday's official jobs report. The Labor Department reported that
nonfarm payrolls had increased by 243,000 in January, the second-straight month
of better-than-expected gains and the most since last April, while the
unemployment rate had declined two-tenths of a point to 8.3%—its
lowest level since February 2009. The industries with the largest employment
gains were manufacturing, professional and business services, and leisure and
hospitality. While job creation appeared to be gaining traction, the number of
layoffs also showed signs of slowing, as fewer people filed claims for
unemployment benefits. The week's fourth-quarter earnings reports were mixed,
which may have restrained gains somewhat. In addition, Federal Reserve Board
Chairman Ben Bernanke told a congressional committee that while the pace of
economic growth would increase modestly this year, the economy faced
considerable headwinds, including the weak housing sector and continuing
challenges stemming from the sovereign debt crisis in Europe. He urged
lawmakers to reduce the federal debt but cautioned against cutting spending or
raising taxes too quickly, which could undermine the recovery. Investors also
worried about continuing hurdles in resolving Greece's debt burdens.
|
U.S. Stocks1 |
|||
|
Index2 |
Friday's Close |
Week's Change |
% Change |
|
DJIA |
12862.23 |
201.77 |
5.28% |
|
S&P 500 |
1344.90 |
28.58 |
6.94% |
|
NASDAQ Composite |
2905.66 |
89.11 |
11.54% |
|
S&P MidCap 400 |
971.18 |
28.64 |
10.43% |
|
Russell 2000 |
830.74 |
32.46 |
12.15% |
This chart is for illustrative purposes only and does not
represent the performance of any specific security. Past performance cannot
guarantee future results.
1Source of data Reuters, obtained through Yahoo! Finance Closing
data as of 4 p.m. ET.
2The Dow Jones Industrial Average and the Standard & Poor's 500
Stock Index of blue chip stocks, the Standard & Poor's MidCap 400 Index,
and the Russell 2000 Index are unmanaged indexes representing various segments
by market capitalization of the U.S. equity markets. The Nasdaq Composite is an
unmanaged index representing the companies traded on the Nasdaq stock market
and the National Market System.
___________
U.S. Bond Market
Week Ended February 3, 2012
The
U.S. economy added 243,000 new jobs in January, and the unemployment rate fell
from 8.5% to 8.3%, the lowest level in three years. The strong performance was
unexpected by most economists and was welcomed by investors, who have
demonstrated a stronger appetite for riskier assets since the end of 2011.
Employers have added an average of 201,000 jobs a month over the past three
months. The unemployment rate is now almost one percentage point lower than it
was in the summer of last year, when concerns about a new recession drove
investors into Treasuries and other low-risk areas of the market. The U.S.
economy added about 1.8 million jobs through all of 2011, nearly twice as many
as in the year before. In addition, initial claims for unemployment benefits
declined to a seasonally adjusted level of 367,000 last week, according to the
Labor Department, continuing their downward trend. Following the release of the
reports on Friday, Treasury yields rose sharply and finished above their levels
of the previous week.
|
U.S. Treasury Yields1 |
||
|
Maturity |
February 3, 2012 |
January 27, 2012 |
|
2-Year |
0.23% |
0.21% |
|
10-Year |
1.93% |
1.89% |
|
30-Year |
3.13% |
3.06% |
This
table is for illustrative purposes only. Past performance cannot guarantee
future results.
1Source of data: Bloomberg.com, as of 4 p.m. ET Friday, February
3, 2012.
___________
International Stocks
Foreign stock markets closed higher for
the week ending January 27, 2012 with the broad international measure, the MSCI
EAFE Index (Europe, Australasia, and Far East), gaining 1.64%.
|
|
||
|
Region/Country |
Week's Return |
% Change Year-to-Date |
|
EAFE |
1.64% |
5.98% |
|
Europe ex-U.K. |
1.80% |
6.45% |
|
Denmark |
1.16% |
3.66% |
|
France |
1.67% |
6.46% |
|
Germany |
3.29% |
11.88% |
|
Italy |
3.42% |
7.07% |
|
Netherlands |
1.26% |
3.59% |
|
Spain |
3.01% |
3.40% |
|
Sweden |
0.71% |
6.76% |
|
Switzerland |
0.37% |
3.73% |
|
United Kingdom |
0.99% |
3.71% |
|
Japan |
1.20% |
4.74% |
|
AC Far East ex-Japan |
1.80% |
9.48% |
|
Hong Kong |
2.17% |
10.36% |
|
Korea |
1.74% |
11.19% |
|
Malaysia |
2.21% |
4.36% |
|
Singapore |
4.34% |
14.43% |
|
Taiwan |
0.00% |
3.62% |
|
Thailand |
3.17% |
6.47% |
|
EM Latin America |
1.42% |
12.57% |
|
Brazil |
1.49% |
15.30% |
|
Mexico |
1.64% |
7.41% |
|
Argentina |
0.64% |
21.20% |
|
EM (Emerging Markets) |
2.18% |
11.02% |
|
Hungary |
8.10% |
25.33% |
|
India |
5.25% |
21.22% |
|
Israel |
0.28% |
10.39% |
|
Russia |
4.43% |
14.23% |
|
Turkey |
7.35% |
18.49% |
International Bond Markets
International bond markets in developed
countries were higher this week, with the J.P. Morgan Global Government Bond
Less U.S. Index gaining 1.52%.
|
|
||
|
Region/Country |
Week's Return |
% Change Year-to-Date |
|
Developed Markets |
1.52% |
1.27% |
|
Europe |
|
|
|
Denmark |
1.30% |
-0.90% |
|
France |
1.98% |
0.99% |
|
Germany |
1.86% |
0.78% |
|
Italy |
4.26% |
7.04% |
|
Spain |
4.73% |
4.00% |
|
Sweden |
0.17% |
0.16% |
|
United Kingdom |
1.05% |
0.10% |
|
Japan |
0.64% |
0.38% |
|
Emerging Markets |
1.02% |
1.23% |
|
Argentina |
2.21% |
11.06% |
|
Brazil |
0.41% |
0.28% |
|
Bulgaria |
0.90% |
1.52% |
International Currency Markets
On the currency front, the U.S. dollar
was weaker against the major currencies for the week.
|
|
|||
|
Currency |
Close |
Week's Return |
% Change |
|
Japanese yen |
76.735 |
-0.50% |
-0.27% |
|
Euro |
1.31321 |
-1.64% |
-1.16% |
|
British pound |
1.56671 |
-0.90% |
-0.81% |
1U.S. dollars per national currency unit.
Sources: Foreign stock markets and
currency sections are from Rimes Technologies, using MSCI data. International
bond markets are from J.P. Morgan.
Note: All returns are in U.S. dollars.
All bond indices are J.P. Morgan. All stock indices are Morgan Stanley Capital
International (MSCI).
|
Equity Indices |
|
|
EAFE: |
MSCI Europe, Australasia, and Far East Index |
|
Europe Ex-U.K.: |
MSCI Europe ex-U.K. Index |
|
Far East Ex-Japan: |
MSCI AC Far East ex-Japan Index |
|
Latin America: |
MSCI Emerging Markets Latin America Index |
|
Emerging Markets: |
MSCI Emerging Markets Index |
|
Bond Indices |
|
|
Developed Markets: |
J.P. Morgan Global Government Bond Less U.S. Index |
|
Emerging Markets: |
J.P. Morgan Emerging Markets Bond Index Plus |
All charts are for illustrative purposes only and do not represent the
performance of any specific security. Past performance cannot guarantee
future results.