US Jobs data pushes wall street up by almost 5%

Yesterday I wrote about how US markets fell following bad news from the french banking sector. Well today we are seeing the wall street in a very positive mood. At 1.00 IST the three major US indices, the DOW, NASDAQ and S&P 500 are trading almost 5% above their previous close. This surge in markets has been caused by jobs data released today.

As revealed by the jobs data, the first time jobless benefits claim fell by 7,000 in the week ended August 6, this is the lowest level since April of this year. Market experts are saying that this is an indicator that the economy is growing at a moderate pace. The markets remain highly volatile though. The thing that's driving the markets is the news coming out of Europe.

Markets were also buoyed by the better than expected results posted by some big names like CISCO which rose 16%  after it posted figures that beat market expectations. On the home front TATA Motors announced a flat profit the quarter at Rs. 19.19 billion. The European markets too turned around yesterday's loss and ended the day in green.

Global markets are highly volatile and all eyes are focused on how the Euro debt crisis unfolds. The crisis is has affected countries on both ends of the spectrum. Recently doubts have been cast over France, which till now was in the rescuer's camp as well the tiny nation of Cyprus has been engulfed by the crisis. The Cyrus finance minister made a statement that a bailout was imminent.

Chaos everywhere!

The world markets have been in a chaos ever since S&P downgraded the U.S to AA+. Fears of a double dip recession have been renewed. The downgrade might be questionable but its impact has been significant as we have been seeing over the last few days. Massive selling by investors who are fearing of a recession. Its a world where the pessimist's rule. Good news is hard to come by. Every day is throwing up some more bad news.

As I am writing this blog major U.S indices are reeling in the red. Recent news of bad health of the French banking sector send huge shock-waves among the U.S markets. The worry was about the French banking sectors huge exposure to shaky European Debt. Major French banks Societe Generale and BNP Paribas witnessed huge falls on French bourses. Bank of America also saw a big fall of almost 11 percent. A day before the U.S markets had seen a sharp recovery after the Fed announced that it would keep the interest rates at near zero levels for the coming two years to aid economic recovery. This cheer however was short lived as the markets tanked again the next day.

A Reuters survey revealed that 73% of Americans feel that their country is on the wrong track and that they are headed for another recession. This survey clearly highlights the pessimism that has gripped the world. The global economy was already troubled by the Euro zone problems and now the U.S debt issue has added to the already worse situation. The way things are moving ahead in the Euro zone and in U.S. it seems that some very painful days await us in the near term. Seems like I too have caught on the pessimism!