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Midday Market Report: Improving US Job Market Offsets Europe Pessimism

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Stocks are virtually flat today as Europe's debt crisis weighs on investor sentiment on the eve of the employment situation report.

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Positive jobs data in the United States is helping equities markets soften their losses today.

Spain's fiscal mess started drawing the attention of investors yesterday when a bond auction went rather poorly. Yields on Spanish debt have been rising for just over a month now. Credit default swaps on Spanish bonds have steadily risen 21% since the beginning of the year, while bets that Portugal will need more aid declined by 1%. If Spain turns out to be in need of a bailout, it could be much more disastrous for Europe than Greece's bailout was. Compared to Spain, Greece is a tiny economy. At the moment, the unemployment rate in Spain is higher than any other country in the European Union.

European equities ended mixed today.
  • The Eurostoxx 50 (^STOXX50E) fell 0.25% to 2,392.54.
  • The FTSE 100 (^FTSE) rose 0.35% to 5,723.67.
  • Germany's DAX (^GDAXI) slipped 0.13% to 6,775.26.
Europe's troubles wore down on US investor sentiment, but a drop in initial jobless claims softened the blow to the markets.
  • The Dow (^DJI) fell 0.14% to 13,056.24.
  • The S&P 500 (SPY) slipped 0.09% to 1,397.77.
  • The Nasdaq (^IXIC) gained 0.41% to 3,080.60.
The number of Americans applying for unemployment insurance last week fell by 6,000 to a fresh four-year low of 357,000. A separate report showed that mass layoffs fell to 33,880 in March from February's 51,728. The improving jobs picture is an upbeat preview for the March employment situation report that will be released tomorrow at 8:30 a.m. EDT. The unemployment rate is projected to stay flat at 8.3%. Economists are expecting a net gain of 201,000 jobs in March. Yesterday, the ADP (ADP) report counted 209,000 net hires.

Oil rebounded on expectations of increased demand after the jobs data was released. WTI futures rose 1.43% to $102.92/barrel.

Twitter: @vincent_trivett
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