Stocks, dollar climb after strong U.S. job growth data

Published On: 09, Dec 2017 | Source:

Wall Street and other major global stock markets rose on Friday and the U.S. dollar was on pace for its fifth day of gains after data showed robust U.S. job growth. The pan-European FTSEurofirst 300 index rose 0.74 percent, supported by news that Britain and the European Union had a breakthrough in Brexit negotiations. U.S. jobs grew at a strong clip in November even though the wage gains that could fuel inflation remain moderate. The U.S. jobs report followed encouraging economic data from China and Japan that buoyed Asian shares. “We have a continuation of an economy that has been pretty firm and pretty balanced for the better part of the last several years and that’s been good for stock prices,” said Jason Ware, chief investment officer at Albion Financial Group in Salt Lake City. “What we are seeing are yields under control and stocks doing well, but the report was strong enough to suggest a bit of a bump in the dollar,” Ware said. The Dow Jones Industrial Average rose 74 points, or 0.31 percent, to 24,285.48, the S&P 500 gained 9.82 points, or 0.37 percent, to 2,646.8 and the Nasdaq Composite added 21.67 points, or 0.32 percent, to 6,834.51. Technology stocks such as Microsoft and Oracle helped pace the advance, building on the rebound from the selloff in the sector earlier in the week. MSCI’s gauge of stocks across the globe gained 0.47 percent.

Investors also are continuing to watch a U.S. tax bill moving through Congress that will slash corporate levies, and may have been relieved that U.S. lawmakers late on Thursday agreed to a temporary funding bill that averted a government shutdown. U.S. President Donald Trump on Friday signed the legislation to fund the federal government for two weeks. “Investors are also taking comfort from the lack of surprise from Washington, with the House and the Senate passing continuing resolution,” said Eric Wiegand, senior portfolio manager at U.S. Bank’s Private Client Reserve unit. In Europe, the banks index jumped 2.2 percent after financial regulators reached a long-sought deal on Thursday to harmonize global banking rules. The dollar rose against the euro and yen in choppy trading after the U.S. jobs data, but gains were capped by wages data that analysts said were disappointing. The dollar index rose 0.11 percent, with the euro down 0.04 percent to $1.1766. “The wages data reinforces the belief that inflationary pressures remain well-contained, keeping the Federal Reserve’s monetary tightening plans in check,” said Karl Schamotta, director of global product and market strategy at Cambridge Global Payments in Toronto.

The U.S. Federal Reserve is widely expected to raise interest rates at its Dec. 12-13 policy meeting, but Friday’s jobs report could shape debate on monetary policy next year. Bitcoin lost almost a fifth of its value in 10 hours on Friday, having surged more than 40 percent in the preceding 48 hours, sparking fears the market may be heading for a price collapse. U.S. Treasury yields were little changed after the closely watched jobs report. Benchmark 10-year notes last fell 1/32 in price to yield 2.3796 percent, from 2.376 percent late on Thursday. Oil prices rose, helped by Chinese crude demand and threats of a strike in Africa’s largest oil exporter. U.S. crude rose 1.09 percent to $57.31 per barrel and Brent was last at $63.33, up 1.82 percent on the day.