US markets jump on hopes of Central Bank moves

The US markets jumped on Thursday, amid reports that central banks may take steps to help economies battered by European debt crisis. There was a growing speculation that the Federal Reserve will discuss stimulus efforts as reports showed jobless claims unexpectedly climbed and the cost of living fell by the most in more than three years. New claims for unemployment insurance in the US rose for the week ending June 9. According to data released by the US Labor Department, seasonally adjusted weekly jobless claims increased 6,000 to 386,000 from the previous week's revised level of 380,000. The total number of people claiming benefits in all programs for the week ending May 26 was 5,824,739, a decrease of 145,990 from the previous week.

Besides, the consumer price index for the US fell 0.3% in May after remaining relatively unchanged in April. Compared to May 2011, consumer prices rose 1.7% for the year. Excluding the volatile food and energy sectors, core consumer prices rose 0.2% in May. Also, foreclosure filings which include default notices, scheduled auctions and bank repossessions were reported on 205,990 US properties in May, an increase of 9% from April but still down 4% from May 2011.

In Europe, UK Chancellor of the Exchequer George Osborne and Bank of England Governor Mervyn King are preparing two programs to increase the flow of credit. The central banks of major economies are prepared to take action if needed to boost liquidity in financial markets if the Greek elections cause tumultuous trading. On the other hand, German Chancellor Angela Merkel rejected quick solutions proposed to fix Europe’s financial crisis such as joint debt sharing, saying her nation can’t save the world economy alone and other G-20 countries must help.

The Dow Jones industrial average gained 155.53 points, or 1.24 percent to end at 12,651.90. The Standard & Poor's 500 Index gained 14.22 points, or 1.08 percent, to 1,329.10, while the Nasdaq Composite Index was up 17.72 points, or 0.63 percent, to close at 2,836.33.

The Indian ADRs closed mixed on Thursday; HDFC Bank was down 1.04%, Tata Motors was down by 0.47% and Dr. Reddy’s Lab was down 0.31%. On the flip side, Infosys was up by 0.56% and Wipro was up 0.07%.