Fed Chair Says He Won't Resign If President Trump Asks Him To

Leslie Hanson
January 5, 2019

At midday, the Toronto Stock Exchange's S&P/TSX composite index was up 177.19 points, or 1.25 per cent, at 14,389.94.

The Labour Department reported Friday that USA employers added a net 312,000 new positions in December, smashing economists' expectations.

The gains, also driven by strong job creation data, reversed sharp falls from a day earlier, extending the recent rollercoaster ride in markets.

USA stocks opened the session higher following the December jobs report and added to gains after Federal Reserve Chairman Jerome Powell said the United States central bank had no "pre-set" plan for interest rates and was carefully monitoring economic conditions.

The rally puts Wall Street on course to erase all losses from a day earlier, when stocks plunged after slowing USA factory activity on the heels of Apple Inc's dire revenue warning fueled fears of a global economic slowdown.

Nonfarm payroll jobs climbed by 312,000 in December, and unemployment climbed 0.2 percent to 3.9 percent, which is still lower than the 4.1 percent unemployment rate the Bureau reported last December.

Powell called the employment figures a "very strong report" and showed no concern about the advance in wages.

"No", Powell answered without hesitating when asked at the American Economic Association's annual meeting in Atlanta if he would quit if Trump asked.

The Fed chairman, responding to a question about what he would do if Trump asked him to step down, said he would not resign.

The dollar weakened, Treasury yields advanced and USA stocks surged to close 3.4 per cent higher on the S&P 500 Index as investors interpreted the Fed chairman as sounding as if he sees scope to wait and see how the economy performs before raising rates again. It marked the ninth time the Fed has raised interest rates since 2015.

All the 11 major S&P sectors were higher.

The S&P and Dow Industrials jumped about 3.5 percent and the Nasdaq over 4 percent, putting the three indexes on course to erase all losses from a plunge on Thursday when slowing US factory activity and Apple Inc's (AAPL.O) dire revenue warning fuelled fears of a global economic slowdown.

Despite the rally, US stocks are anchored near mid-2017 lows, with a chunk of the losses coming last month in what was the S&P's worst December since the Great Depression.

Other reports by Iphone Fresh

Discuss This Article