Yet another better-than-expected labour report from the US was not enough to lift Wall Street this afternoon, with investors remaining decidedly cautious despite evidence that the world's largest economy is on the mend.
By 3.15pm (London time), the Dow Jones was down 0.4% at 12,366.47, while the S&P 500 had fallen 0.3% to 1276.85. In London, the FTSE 100 fell back after spiking in the wake of the non-farms data, and was up 0.47% at 5650.44.
Non-farms reap good harvest
Markets have gone into 'petulant child' mode it seems. Today's non-farm payrolls report proved almost as exciting as yesterday's ADP figure, with the US economy adding 200,000 jobs in December, significantly ahead of the forecast 155,000.
In addition, the unemployment rate in the US, which had been expected to tick up to 8.7% from 8.6% a month earlier, fell to 8.5%, its lowest level in nearly three years.
Like the cavalry in an old Western film, the US is once again riding to the rescue, helping to counter all the bleak news from Europe.
The only people who won't be happy about the number will be Republican spin doctors, since the report is a boost for President Obama and his hopes for re-election.
Today's news adds credence to the view that the US economy gained new momentum in the final quarter of the year, after spending the first nine months in the doldrums.
There was some slight nervousness over the downward revisions to October and November, which together indicated 8000 fewer jobs had been added in those months, but overall the trend remains broadly positive.
Hopes are high that the US economy will be able to detach itself somewhat from the dire situation in Europe and the slowing economies of Asia.
Alcoa cuts back on operations
Aluminium producer Alcoa put a dampener on sentiment last night with its comments that it expected to cut 12% of its smelting capacity by the middle of 2012. The move comes after a decline in the price of aluminium due to a global supply glut.
Inventories of the metal have been on the rise as industrial activity around the world dwindles. Alcoa shares lost 2.5% in opening trading, down to $9.13.
The company kicks off the latest US earnings season next week, with companies reporting their results for the final quarter of 2011.
Shares spread betting markets will be hoping that American companies have been able to emulate the improvement in national economic data with better sales and profit figures.
Eurozone unemployment up again
The number of those out of work in Europe reached another record high, with divergence between the various members of the Eurozone increasing steadily.
Although the overall rate was stable at 10.3% for November, the number of claimants rose to 16.37 million, the highest since the launch of the currency.
Core nations, including the seemingly-impervious German economy, saw unemployment drop by 0.1% to 5.5%, but joblessness in the periphery is still rising, up to 13.2% and 22.9% in Portugal and Spain respectively.
The Eurozone is getting closer and closer to a renewed recession, hampering efforts to contain the debt crisis even further.
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'Shares Spread Betting: Alcoa Stocks Fall After Announcing Cuts in Industrial Activity', Article by IG Index, last update: 6-Jan-12
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