US close: Q2 trading starts off on a positive note

dl nyse new york stock exchange wall st street city finance dow jones nasdaq sp finance dollar dollars us usa united states of america 2 — New York Stock ExchangeSharecast photo / Josh White

Wall Street stocks ended the session in the green on the first day of Q2 trading as investors thumbed over March's all-important nonfarm payrolls report.

At the close, the Dow Jones Industrial Average was up 0.40% at 34,818.27, while the S&P 500 was 0.34% firmer at 4,545.86 and the Nasdaq Composite saw out the session 0.29% stronger at 14,261.50.

The Dow closed 139.92 points higher on Friday, reclaiming some of the previous session's losses after the US president confirmed plans to start daily releases from the country's strategic oil reserves.

In focus on Friday was news that the UK will reportedly join the US in releasing more oil from its reserves as part of a joint effort to lower prices and reduce reliance on Russian supplies. According to Bloomberg, an announcement was likely to come via the International Energy Agency. However, sources declined to say the size of the release, citing market sensitivity and the need for countries to act in concert.

US president Joe Biden said on Thursday that his plans to release 1m barrels of oil a day for six months would lay the foundations for the US to achieve energy independence from foreign suppliers. He also said that he expects allies to release as many as 50m barrels from their own stocks.

Also drawing an amount of investor attention, the two-year and 10-year Treasury yields inverted for the first time since 2019, a potential sign that the US economy was headed for a recession. However, the inverted yield curve can not predict exactly when a recession will occur, with history indicating it could be over a year away.

On the macro front, the US economy added 431,000 payrolls in March, according to the Bureau of Labor Statistics, down from the previous month's print of 750,000 and falling short of market expectations for a print of 490,000. Job gains continued in leisure and hospitality, up 112,000, professional and business services, 102,000 higher, retail trade, 49,000 stronger, and food and beverage stores and manufacturing, up 18,000 and 38,000, respectively.

Figures for February were revised sharply higher to show a 750,000 gain, up from 678,000, while the change in total nonfarm payroll employment for January was also revised up by 23,000 to 504,000.

Elsewhere, the ISM's manufacturing PMI fell to 57.1 in March, down from 58.6 in February, well below market forecasts of 59 and pointing to the slowest growth in factory activity since September 2020.

Finally, construction spending in the US increased 0.5% month-on-month to a seasonally adjusted annual rate of $1.70trn in February, cooling off from an upwardly revised 1.6% advance in January but below market expectations of a 1% gain.

No major corporate earnings were released on Friday.

Dow Jones - Risers

Verizon Communications Inc. (VZ) $52.12 2.32%
Visa Inc. (V) $226.36 2.07%
Merck & Co. Inc. (MRK) $83.52 1.79%
Procter & Gamble Co. (PG) $155.09 1.50%
Walmart Inc. (WMT) $151.01 1.40%
Coca-Cola Co. (KO) $62.89 1.40%
Travelers Company Inc. (TRV) $185.25 1.38%
Home Depot Inc. (HD) $301.89 0.86%
Chevron Corp. (CVX) $164.22 0.85%
McDonald's Corp. (MCD) $249.18 0.80%