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The US economy has blown past earlier expectations for a recession, and the latest show of strength came from a report indicating fewer workers applied for unemployment benefits last week than expected. The number remains low relative to history, even if layoffs at Google’s parent company, Macy’s and other big-name companies have been getting attention recently.
In prior months, such a report may have hurt the stock market because of concerns that it would mean a longer wait for cuts to interest rates from the Federal Reserve. But investors have been coming around to the idea that good news on the economy is good for stocks because it will drive profits for companies, and futures tied to the S&P 500 rose after the report.
The latest set of earnings reports from big US companies were also keeping the stock market mixed overall.
Disney jumped 11.5 per cent after it reported stronger profit for the latest quarter than analysts expected. It benefited from cost cuts and growth at its theme parks.
Ralph Lauren was another winner, rising 16.8 per cent after its profit and revenue topped Wall Street’s forecasts. It said it saw strong holiday sales around the world, led by Asia.
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New York Community Bancorp was having another sharp zigzag day and went from an early loss of nearly 10 per cent to a gain and back to a loss of 6.5 per cent. Its stock has dropped nearly 60 per cent since it shocked investors across the banking industry with a surprise loss last week, and Moody’s cut its credit-rating to “junk” status earlier this week.
Stocks of other regional banks have also been swinging sharply lately, forcing uncomfortable memories of last year’s banking crisis.
In the bond market, the yield on the 10-year Treasury ticked up to 4.15 per cent from 4.12 per cent late Wednesday.
In stock markets abroad, indexes rose across much of Asia and Europe.
Stocks climbed 1.3 per cent in Shanghai after China replaced its top stock market regulator late Wednesday with an industry veteran nicknamed the “broker butcher,” analysts say, due to his record for cracking down on market abuses such as insider trading. Stocks fell 1.3 per cent in Hong Kong, though.
Beijing has been struggling to prop up what have been some of the world’s worst-performing markets this year.
With AP
The Market Recap newsletter is a wrap of the day’s trading. Get it each weekday afternoon.
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