U.S. Stocks Rally With Dollar on Economy Optimism; Crude Falls
Source: Bloomberg
U.S. stocks surged the most in almost three months and the dollar rebounded as jobs data reinforced optimism that the economy is robust enough to withstand higher interest rates.
The Standard & Poor’s 500 Index rallied 2 percent and the Dow Jones Industrial Average added more than 350 points. The greenback jumped after its steepest drop since March as jobs data kept the odds for a rate increase this month above 75 percent. Treasuries rose with gold on speculation any subsequent hikes will be gradual. Oil plunged to $40 a barrel.
“This number ought to clinch it for the Fed in terms of liftoff in December,” Phil Orlando, who helps oversee $360 billion as chief equity market strategist at Federated Investors Inc. in New York., said by phone. “We should have a spike after yesterday’s overreaction on the euro and Draghi.”
The payrolls report underscored Fed Chair Janet Yellen’s contention that the American economy can withstand higher interest rates this year. Equities extended gains after Mario Draghi signaled the European Central Bank will add to stimulus if needed, a day after the institution roiled markets by disappointing investors with the scale of expanded monetary support.
Read more: http://www.bloomberg.com/news/articles/2015-12-03/asian-futures-signal-more-stock-losses-on-draghi-disappointment