Last checked at 
* Major U.S. indexes up modestly; transports, small caps
outperform
* Energy leads major S&P sector gainers; real estate weakest
group
* Euro STOXX 600 index closes up ~0.4%
* Dollar, gold slip; crude, bitcoin rally
* U.S. 10-Year Treasury yield ~1.30%
Sept 2 - Welcome to the home for real-time coverage of
markets brought to you by Reuters reporters. You can share your
thoughts with us at markets.research@thomsonreuters.com
EUROPEAN STOCKS CLOSE SHORT OF RECORD HIGHS (1158 EDT/1558
GMT)
The pan-European STOXX 600 index just closed 0.4%
higher on the day at 474.77, just short of a record high of
476.16 hit last month.
To recap, there have been some big moves in the market today
as company's continue to declare earnings.
Polish video-game maker CD Projekt's shares closed a solid
11.5% higher after H1 results beat expectations.
Deals also drove price action, with Swedish Orphan Biovitrum
(SOBI) closing up a whopping 25% after receiving an $8 billion
offer from U.S. venture capital firm Advent International and
Aurora Investment.
There were losers, too. BHP closed 5.5% lower on the day
after a 6.9% fall in the Australian stock market. BHP announced
an exit from its $13 billion petroleum business in a portfolio
shake-up that will see it leave London's FTSE100 index.
Tech stocks, which began the day as laggards have bucked the
trend and closed 0.34% higher.
Across smaller caps, online trading platform CMC Markets'
shares closed over 27% lower, hit after a profit warning as
reduced market volatility resulted in lower transaction volumes
across new and existing clients. Competitor IG Group also fell
11%.
Britain's biggest homebuilder Barratt Developments lost a
comparatively modest 4.5% after saying it plans to increase the
number of home completions in the current fiscal year to
pre-pandemic levels.
Shares in France's Lagardere closed up 2.4% after big drops
in previous days as luxury goods billionaire Bernard Arnault
confirmed he was effectively cutting ties with the company's
chief executive.
Budget airline Ryanair closed 0.4% higher after it said it
flew 11.1 million passengers in August, 75% of the number it
carried in August 2019 before COVID-19 pandemic hammered the
industry.
(Ritvik Carvalho)
*****
JOBLESS CLAIMS, TRADE, FACTORY ORDERS, ETC: RIDERS OF THE
STORM (1055 EDT/1455 GMT)
A hurricane of data followed Ida's tear through the
Northeast on Thursday, all of which supported the view that the
economy, while burdened with the Delta variant, supply
constraints and a labor drought, is still clearing the debris in
COVID's wake.
The number of U.S. workers filing first time applications
for unemployment benefits dipped last week to
340,000, according to the Labor Department.
The number came in below consensus to touch the lowest level
since before the first wave of mandated restrictions shuttered
business at the outset of the pandemic, which catapulted claims
to a mind-boggling 6.149 million.
Jobless claims have been on a fairly consistent downward
trajectory since then, suggesting not only a steady labor market
recovery but a persistent worker shortage.
"In today's extremely tight labor market we think the bar
for layoffs is even higher than usual," writes Ian Shepherdson,
chief economist at Pantheon Macroeconomics. "Businesses which
let staff go might find it very hard to rehire them after the
Delta wave is over, given the record number of job openings."
Still, claims remain well above the 200,000 to 250,000 range
associated with healthy labor market churn.
Ongoing claims, reported on a one-week lag,
dropped to 2.748 million. For context, the number of people
collecting unemployment benefits for two weeks or longer roughly
equals the population of Chicago.
The afore-mentioned labor shortage is evidenced in the 17%
drop in announced job cuts at U.S. firms in August.
Executive outplacement firm Challenger, Gray & Christmas'
planned layoffs data came in at 15,723, the
smallest reading in over 24 years and a whopping 86% fewer than
a year ago.
"Companies are much more concerned about their talent
getting poached than with finding ways to cut staff. They are in
full retention mode," said Andrew Challenger, senior vice
president at Challenger Gray.
So far this year, the sectors to suffer the most layoffs are
aerospace/defense, telecom, services, energy and
healthcare/products.
The Labor Department also revised its second-quarter labor
costs and productivity numbers.
The data now shows productivity, or average
worker output per hour, rose in the quarter at a 2.1% annualized
rate, down from the previously reported 2.4% increase.
Labor costs, on the other hand, were upped 0.3
percentage points to a 1.3% gain.
Both indicators confounded economist forecasts by moving in
the opposite direction than expected.
The revisions could signify a stronger rebound of
lower-paying services jobs - which are associated with lower
productivity - along with employers beefing up compensation in
order to attract and retain staff.
But the increase in productivity is still significant, and
as Lydia Boussour, lead U.S. economist at Oxford Economics (OE)
points out, it could linger long beyond the health crisis.
"The pandemic has induced an upside shock to productivity,"
says Boussour. "The adoption of technology has accelerated, new
firms are being created at an historic pace, and the shift to
remote work is likely to outlast the crisis."
The gap between the value of goods and services imported to
the United States and those produced domestically and shipped
abroad narrowed more than expected in July,
dropping 4.3% to $70.1 billion, according to the Commerce
Department.
The was attributed to a drop in imports and a demand pivot
from goods to services as consumers took advantage of relaxing
social distancing restrictions.
And some analysts expect the narrowing to continue in the
months ahead.
"We expect the deficit to narrow further as foreign
consumption strengthens and domestic demand moderately softens,"
says Mahir Rasheed, U.S. economist at OE. "The pandemic will
continue to pose downside risk to trade flows, but we expect a
gradual normalization in trade dynamics as vaccinations increase
and supply disruptions slowly ease."
The closely-watched U.S.-China goods deficit grew to $28.6
billion.
Finally, factory orders data was the late
arrival, delivering a slightly above-consensus 0.4% monthly gain
in July.
The increase marked a sharp deceleration from the prior
month's 1.5% jump, and falls nicely into lockstep with other
recent numbers from the manufacturing sector.
On Wednesday, the Institute for Supply Management's (ISM)
PMI report for August showed activity among U.S. goods producers
continuing to expand, but losing momentum over the last several
months under the burden of supply constraints, and, wait for
it...the labor shortage.
All of the above is prologue for Friday's employment report
from the Department of Labor, setting the stage for what
analysts expect to be 750,000 jobs added and an unemployment
rate easing to 5.2%.
As for Wall Street, the indexes are green in morning
trading, with economically sensitive cyclicals, small caps
and transports leading the pack.
(Stephen Culp)
*****
S&P 500, NASDAQ, CLAW TO FRESH HIGHS (1001 EDT/1401 GMT)
The S&P 500 and Nasdaq are posting modest
gains in early trade on Thursday. Nevertheless, they both hit
fresh record highs boosted by hopes that the Federal Reserve
would maintain an accommodative policy amid signs that a broader
economic recovery was slowing.
The Dow Jones Industrial Average is also gaining
slightly, but is still around 0.6% shy of its August 16 closing
high of 35,625.40.
Energy is the best performing major S&P 500 sector
as crude prices attempt to stabilize after suffering
their biggest monthly drop in 10 months in August.
Still, so far on Thursday, there is an overall very slight
tilt in favor of growth over value. The IGX/IVX
ratio is at its highest level since early November of last year.
Here is where markets stand in early trade:
(Terence Gabriel)
*****
BROADER NASDAQ GETTING ITS STEP BACK? (0900 EDT/1300 GMT)
The Nasdaq Composite ended at a new high on
Wednesday. With that, the tech-laden index is now up about 19%
year-to-date (YTD).
Meanwhile, the Nasdaq 100, or the 100 largest
non-financial companies on the Nasdaq, also ended at a new high,
and is up 21% so far this year. This modified cap-weighted index
is handily outperforming its equal-weighted version,
which is only up around 16% YTD.
Tech-titans are underpinning the indexes: the average 2021
YTD gain in the Nasdaq's 5 biggest market-cap companies is
nearly 33%.
Against this, market internal measures have not been keeping
pace. For example, the Nasdaq advance/decline line peaked on
February 9, and has been diverging since then.
However, for about the last two weeks, various Nasdaq
internal measures have been showing some life.
One such measure, the Nasdaq New High/New Low (NH/NL) index,
which had fallen to a more than 16-month low, bottomed on August
23 at 37.1%:
It has now risen 7-straight days, reclaimed its 10-day
moving average (DMA), and broken above a resistance line from
its mid-June high. And at Wednesday's close of 59.8%, it ended
just shy of its most recent peak of 60.4% set on August 11.
Just looking back to early 2020, there has been a pattern
that when the NH/NL index v-bottomed, reclaimed its 10-DMA, and
took out its most recent high, the Nasdaq has seen extended
periods of strength.
Therefore, a NH/NL index close above 60.4% may offer
potential for the continuation of IXIC gains, as the broader
Nasdaq adds fuel to the fire. In fact, since early 2020, NH/NL
index highs have been over 90%.
However, A NH/NL index down-tick, followed by a break of its
10-DMA can remove the burgeoning support from the IXIC, and,
once again, put the Composite at risk for the kind of more
severe declines that occurred in early and late 2020, as well as
earlier this year.
(Terence Gabriel)
*****
FOR THURSDAY'S LIVE MARKETS' POSTS PRIOR TO 0900 EDT/1300
GMT - CLICK HERE:
(Terence Gabriel is a Reuters market analyst. The views
expressed are his own)
