U.S. stocks advanced, rebounding from yesterday’s drop, as central banks in Japan and Europe reassured investors that they will keep economies awash in cash to bolster growth. Commodities slid for a fifth day and the yen weakened the most since October 2011.
The Standard & Poor’s 500 Index added 0.3% at 3:12 p.m. in New York, rebounding from yesterday’s 1.1% retreat from a record. The S&P GSCI Index of 24 commodities lost 0.9% and has tumbled about 3.8% in five days. Ten- year Treasury yields fell five basis points to 1.76%, the lowest since Jan. 2. Japan’s currency depreciated 3.3% to 96.17 yen per dollar while Korea’s won slid to a six-month low. The euro reversed early losses to rally 0.7% to $1.2939.
The Bank of Japan said it will buy longer-term government bonds as part of its asset-purchase program while European Central Bank President Mario Draghi said policy will remain accommodative after keeping the benchmark rate at 0.75%. U.S. data showed jobless claims increased last week, a day before the monthly payrolls report.
“Expectations were high for the Bank of Japan and they managed to exceed expectations,” Janelle Nelson, a Minneapolis- based portfolio analyst with RBC Wealth Management’s portfolio advisory group, said in a phone interview. Her firm manages about $315 billion in client assets. “The big issue for investors will be what the U.S. employment report shows tomorrow.”
The government report tomorrow is forecast to show a gain of 190,000 jobs in U.S. payrolls last month, following a 236,000 advance in February, according to economists surveyed by Bloomberg. The jobless rate probably stayed at 7.7%.
Jobless claims rose by 28,000 to 385,000 last week, the highest since Nov. 24, Labor Department figures showed in a report that reflected the difficulty in adjusting the figures around the Easter holiday and spring break at schools. The median forecast of 47 economists in a survey called for a drop to 353,000.
The S&P GSCI Index extended yesterday’s 2% slump and slid to the lowest level since December on a closing basis as 15 of its 24 commodities retreated. Gold for immediate delivery declined as much as 1.1% to $1,540.27 an ounce, the lowest in 10 months, and silver fell 0.4%. West Texas Intermediate oil dropped 1.3% to $93.26 a barrel and is down 4% in the past two sessions, its worst two-day decline since Nov. 8.
Among U.S. stocks moving today, McDonald’s Corp., AT&T Inc. and Hewlett-Packard Co. rose at least 1.4% to lead gains in the Dow Jones Industrial Average while International Business Machines Corp., Alcoa Inc. and Exxon Mobil Corp. fell the most. Brinker International Inc. gained 1.7% after Raymond James Financial Inc. raised its rating on the owner of the Chili’s and Maggiano’s restaurant chains.