Big opening jump on tap for stocks
Small-cap stocks are expected to open with a bang following a surprisingly tame employment report. The Russell 2000 (NYSE:IWM) was expected to open about 0.7% higher in line with a jump in after-hours trading, which would put the index near 734.
The jobs data showed a decline in payrolls of 20,000, which was well below the forecast for a decline of 80,000. Investors also will be relieved to see that the unemployment rate eased back to 5%, down from 5.1% last month, and more importantly much better than the 5.2% median forecast.
The U.S. dollar rallied hard and fast in the immediate moments after the jobs data came out, with the euro and dollar shedding more than 100 bps together, or about 0.9%, which likely will provide a lift to equities if the dollar can hold those gains throughout the session.
In overnight action, equities markets around the world played catch up to the big move in U.S. equities, with Japan’s Nikkei up 2%, Hong Kong’s Hang Seng up 1.9%, Australia’s All-Ords up 1.9% and the European DJ Stoxx 50 up over 1%.
Among big name movers overnight, Sun Microsystems Inc. (Nasdaq:JAVA) tumbled about 13% on soft earnings, while comScore Inc. (Nasdaq:SCOR) jumped 17% as the company said earnings would top Street estimates. In a recurring theme from the gambling front, Wynn Resorts (Nasdaq:WYNN) was down over 3% amid a downturn in the Las Vegas business because of the economy.
