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World stock markets rallied Wednesday amid signs thatthe American recovery could be gaining traction - ledpartly by factory output - and relief that Europe might beon the verge of finding some much-needed leadership onits widening financial crisis.“There is a subtle mood shift,” said Bob Atwell, chief executive at Nicolet National Bank in Green Bay. Even asmortgage and banking businesses remain a drag on theU.S. economy, “I sense a shift in psychology that’s moretilted to optimism than pessimism.”The Institute for Supply Management, a national industry association, said its widely followed manufacturing activity index posted its 16th straight month of expansionin November. Another indicator that curled upward Wednesday wasthe monthly employment survey from ADP EmployerServices, which showed that U.S. employers added more jobs than in any other month since November 2007.Data from ADP, which provides payroll and tax servicesto other companies, sparked a speculative frenzy aheadof Friday’s official monthly employment report from theU.S. Labor Department, as some traders bet the nationfinally will show a large monthly job gain.The Dow Jones industrial average posted its biggest gainsince Sept. 1, rising 249.76 points, or 2.3%, to 11,255.78.The Standard & Poor’s 500 index rose 25.52, or 2.2%, to1206.07. The Nasdaq composite rose 51.20, or 2.1%, to2549.43. As recently as summer, economists speculated about thelikelihood of a double-dip recession. A full 12 monthsinto the recovery, American unemployment remainshigh by any measure. And in many ways, the economy continues to send mixed signals.
But sentiment appears to be shifting, economists said,not least after the government last week revised itsestimate of the pace of economic growth to 2.5% in thethird quarter from a preliminary 2.0%.In a busy day of economic releases Wednesday, theFederal Reserve Bank reported that 10 of its 12 regionsaround the nation are growing. Only those withheadquarters in Philadelphia and St. Louis reported thatconditions are mixed.The Institute for Supply Management’s manufacturing index should carry special weight in Wisconsin, whichemploys a greater share of its workforce in manufacturing than any other state. The factory activity index came in at56.6 for November, little changed from 56.9 in October. Any reading above 50 indicates growth. At the depths of the recession, it was closer to 30; as recently as April, itshot to 60.4.
Awaiting news on jobs
Wall Street’s rally set the stage for Friday morning’srelease of the Labor Department’s jobs report forNovember.Job-creation gains have been glacial at best during most months so far this year. In October, the ranks of unemployed Americans who gave up even trying to look for a job hit a record of more than 1.2 million, even as thenation managed to add 151,000 net new jobs.Economists on average expect the nation’s employersto at least match October’s gains, said Rogier Kamerling,chief economist in Milwaukee at M&I Capital Markets.
Economy takes on a rosier glow
| Milwaukee Journal Sentinel December 1, 2010
Economy takes on a rosier glow
Manufacturing expansion leads to optimism about job growth
Milwaukee Journal Sentinel
December 1, 2010