Midday Report: US Stocks Jump After Strong Jobs, Services Data; Oil Slumps as OPEC+ Unveils Plans to Taper Output Cuts

Monday, April 5, 2021 12:41 PM | MT Newswires

US stocks jumped following strong jobs and services data while oil fell after a group of oil producers including Saudi Arabia and Russia unveiled plans to ease production cuts.

The Dow Jones Industrial Average rose by 417.61 points, or 1.3% to 33,570.82. S&P 500 was higher by 1.5% to 4,079.82, after surpassing the 4,000-mark for the first time ever last week on Thursday. Nasdaq was up by 1.5% to 13,677.31. Consumer discretionary and communication services were among the biggest gainers while energy was the sole decliner after midday on Monday.

The US 10-year yield fell by 1.4 basis points to just under 1.71% and the US dollar index dropped by 0.5% to 92.58.

The IHS Markit Services reading was revised up to 60.4 in March from the flash reading of 60, keeping the index ahead of the 59.8 print in February. An IHS report said the gain indicated a "substantial increase in business activity" across the sector amid surging demand. Following that, the ISM's services index for March jumped to a record high 63.7 from 55.3 in February, beating estimates. Gains were recorded in business activity, new orders, employment and prices, according to an ISM report.

On Good Friday, when markets were closed, data from the US Labor Department showed the economy added 916,000 jobs in March following an upwardly revised 468,000 in February. That compared with market expectations of 647,000, according to data compiled by Trading Economics.

Meanwhile, the West Texas Intermediate futures slid by 3.8% to $59.09. The Organization for the Petroleum Exporting Countries and non-OPEC producers led by Russia, or OPEC+, agreed late last week to a phased reduction in 7.7 million barrels per day of production cuts from next month, gradually increasing supply as oil prices have rallied in recent months.

In company news, Tesla's (TSLA) first-quarter delivery numbers are a "paradigm changer," highlighting that the pent-up demand for the battery automaker's Model 3 /Y is moving to the next stage of growth as part of a global green tidal wave under way, according to a research note from Wedbush. Shares surged 4.6% intraday.

Norwegian Cruise Line (NCLH) said Monday that it sent a letter to the US Centers for Disease Control and Prevention outlining its plan to resume cruise operations from US ports as of July 4th. Shares soared 6%.

The US Supreme Court, in a 6-to-2 decision Monday, ruled in favor of Alphabet's (GOOG) Google in its software copyright case against Oracle (ORCL). Shares of Alphabet rose 4.1%.

In the precious metals markets, gold was up 0.2% to $1,732.20 an ounce, with silver up 0.2% to $25 an ounce and copper up 4.1% to $4.15 per pound.

Among energy ETFs, the United States Oil Fund fell 5% to $39.76 and the United States Natural Gas Fund was down 5% to $9.22. Among precious-metal funds, the Market Vectors Gold Miners ETF was up 0.7% to $33.85 and SPDR Gold Shares were up fractionally to $162.03. The iShares Silver Trust was down 0.5% to $23.02.

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