Markets close on high note

Analysts are putting slimmer odds on a third interest rate hike, thanks to slower-than-expected job and wage growth in August. If the numbers were too high, the Fed almost certainly would have moved to bump up rates another 25 basis points on Oct. 5.

The rally was widespread. It was certainly felt at the TSE, where all but one of the 14 subindexes closed higher today. Overall, the TSE 300 leapt by 99.1, to 7006.1. The conglomerates made big gains. Canadian Pacific Ltd. was trading C$1.55 higher late in the day, at $36.25. The financial services, sensitive to interest rate news, also moved. Royal Bank was up $1.15, to $65.25. BMO was up $1.20, to 53.25.

In late Pacific time trading, the VSE was up, by 4.43, to 411.36. The ASE was up 12.73, to 2673.2. The lone loser today was the ME. It closed on a slump, down 45.47 points, 3716.29.

The news hit stocks and bonds alike. The 30-year U.S. Treasury bond is the most sensitive gauge of expectations for inflation. It’s yield fell 12 basis points, to 6.02. It was 5.10 percent at the beginning of the year.

The Dow gained a full 2%, or 235.24 points, to close at 11,078.45. Nasdaq soared by 3.4%, or 108.87, to 2843.11. The S&P 500 made its single biggest jump of the year. It rose 38.13, to close at 1357.24, or 2.8% higher. Advances outpaced declines on the Dow by 3.4:1. That’s the biggest margin of the year.

Nasdaq saw lots of gains. Speculative tech and computer stocks gained favor after the economic news. Microsoft Corp. took on almost US$3, to close at $94.75. Intel Corp. swelled by US$3.44, closing at $88.75. Yahoo! Inc. was also swept up. It gained $13.44, to $153. EBay Inc. added more than $12, reaching $133.50.

Analysts wonder if the news will carry on over the long weekend. Markets are closed Monday, Labour Day.