WALL STREET WEEK AHEAD
US stock investors have had to take their own self-help course on living with uncertainty due to Europe’s crisis, and they may need to draw on that this week because it’s never clear when the next upheaval will come.
Greece is still in turmoil. Prime Minister George Papandreou will stand down today, and more details should emerge later of how the country’s new coalition government will look.
Other challenges haven’t gone away, such as keeping countries like Italy from going the way of Greece. Two years of crisis have taught investors to be vigilant of new risks emerging from Europe’s debt debacle.
“It takes away the risk of a referendum or renegotiating new terms. Net-net it’s a ‘risk-on’ event,” Thomas Roth, executive director of US government bond trading at Mitsubishi UFJ Securities USA, in New York, said.
Though investors are cautious, stocks may be able to keep in place the recent upward trend as more evidence suggests the US economy is progressing despite Europe’s woes.
Friday’s US monthly jobs report suggested some improvement in October, even though the headline payroll numbers appeared weak.
Nonfarm payrolls rose a tepid 80,000 in October, below economists’ expectations. But employers added 102,000 more jobs than previously estimated in August and September.
And the US unemployment rate slipped to nine per cent. It had been stuck at 9.1 per cent for three straight months. With results in from some 433 of the S&P 500 companies, 70 per cent have beaten forecasts on third-quarter earnings, defying views that growth would be hit by the problems in Europe and a slower economy in China.