Surprisingly positive US employment figures, upbeat corporate results, and good coronavirus news helped equities add to recent gains. The three major averages set new records as the Dow Jones industrial average rose 0.6 percent, the S&P 500 gained 0.4 percent, and the NASDAQ was up 0.2 percent.
Positive quarterly results from prominent companies selling face-to-face services bolstered the reopening trade. Ride-sharing leader Uber, up 4.2 percent, and Expedia, the travel broker, up 16 percent, lifted sentiment, as both reported much better business conditions and results. On the virus front, Pfizer gained 11 percent after clinical trials showed high effectiveness for its anti-Covid pill.
Among sectors, industrials, energy, and utilities paced the day's winners, along with communications services. Health care lagged, despite Pfizer's strength, as Merck, which sells a rival anti-Covid pill, dropped 10 percent, and Moderna, maker of a leading anti-Covid vaccine, fell 17 percent. Energy stocks got a boost from rising oil prices, with Chevron up 1.1 percent and Exxon Mobil up 1.0 percent. Utilities, which are considered interest rate proxies, rose as interest rates dipped.
In US economic news, nonfarm payrolls rose 531,000 in October with a net upward revision of 235,000 for the prior two months. The unemployment rate fell two-tenths to 4.6 percent in October and the U6 unemployment rate, which covers discouraged, part-time or underemployed workers, was also down two-tenths to 8.3 percent.
These price data reflect observations at 4:00 PM US ET: Dated Brent spot crude oil rose US$1.60 to US$82.20 while spot gold rose US$23.01 to US$1,816.78. The US dollar was mixed vs. major currencies. Yields on the US Treasury 30-year bond fell 8 basis points to 1.89 percent, and the 10-year note fell 9 basis points to 1.45 percent.
Mixed Covid-19 news and an upbeat US employment report left equities firmer. The Europe-wide STOXX 600 was up 0.1 percent, the German DAX firmed 0.2 percent, the UK FTSE 100 rose 0.3 percent, and the French CAC gained 0.8 percent.
Markets have derived support from the delay in rate increases from the Bank of England and European Central Bank at their recent meetings. At the same time, many analysts worry the central banks risk a wider outbreak in inflation by delaying rate increases, or the reverse, that pending rate increases from the BOE will prove premature.
Market sentiment suffered as another uptick in coronavirus cases in Europe spurred several governments to consider resuming measures to contain the spread. On the other hand, news of successful trials for Pfizer's anti-Covid pill bolstered sentiment, and supported reopening stocks, with travel & leisure leading the day's winners.
Among other sectors, best were autos & parts, telecom, personal & household, banks, and oil & gas. Lagging were health care, utilities, basic resources, chemicals, and real estate. Among utilities, Energias de Portugal lost 1.5 percent after weak earnings.
The global equities market rally faltered in Asia on disappointing corporate news, on concerns over supply disruptions, and on renewed liquidity problems in China's property sector.
Chinese equities came under selling pressure with energy and utilities stocks weakest as regulators pressed for power cost cuts. Investor sentiment suffered as Kaisa, the property business, halted trading after missing a debt payment. Kaisa is one of China's most heavily indebted developers, after China Evergrande.
China's CSI 300 index fell 0.5 percent and the Shanghai composite fell 1.0 percent. Hong Kong's Hang Seng index dropped 1.4 percent, with big tech and energy stocks leading the selloff. Finance stocks took a hit with HSBC off 3.6 percent after the surprise UK no rate increase.
Japanese major stock indexes gave back some recent gains with a trigger from weakness in the region. Japan's Nikkei 225 declined 0.6 percent and the Topix declined 0.7 percent. Among companies in focus, Toyota fell 1.4 percent after warning it faced more trouble from microchip shortages. Shipping companies extended recent losses with Nippon Yusen down 4.7 percent. Nintendo rose 3.1 percent, despite supply trouble, on reports it would expand its product offerings.
Separately, South Korea's KOSPI slipped 0.5 percent on spillover from Chinese weakness. Taiwan's Taiex benchmark rose 1.3 percent, led by Taiwan Semiconductor, up 2.2 percent.
Australian equities ended higher with the All Ordinaries index up 0.4 percent. Most sectors rose, paced by telecom and utilities as interest rates retreated from recent gains. Precious metals and iron miners lifted materials stocks while biotech lifted health care. Energy lagged as coal producers took a hit from Chinese steps to reduce prices. Tech trailed, with Afterpay down 5.5 percent.