The Dow Jones Industrial Average witnessed a surge in the trading session today rising by close to 300 points on the back of the strong buying interest seen in technology stocks and a stellar set of economic reports concerning labour productivity and private sector hiring, both pointing towards the underlying strength of the US economy. It is imperative to state that this was the 10th session out of 11 that the US markets witnessed a triple digit move which is indicative of the increased level of volatility in the system. The dollar surged during the trading session on the back of the strong economic reports which is being seen as a huge positive for the dollar which continues to trade at multi-year highs.
According to a report released by payroll processor ADP it was reported that businesses added close to 190,000 jobs last month up from 177,000 in July but was below the six month high of 231,000 reported in June. Many analysts believe that the strong reading is a clear indication that the turmoil in the financial markets and worries about faltering growth in China have not yet had much impact on the US job market. It was also reported today by the US labour department, that worker productivity increased at an annual rate of 3.3 percent in the April-June quarter. The reading was a rebound from the first quarter when productivity had fallen at a 1.1 percent rate on the back of the harsh winter conditions which meant workers remained inside or were out of a job during the period.
The strong dollar meant that gold plunged during the trading session. It is imperative to state that gold witnessed a massive surge in the overnight session but the lack of buying interest at higher levels meant that gold continued to trend lower during the trading session.