Global shares hiked on Friday, 4 November and the U.S. dollar dropped after jobs data came in stronger than expected but also hinted at some slack in the tight American labor market, increasing hopes the Federal Reserve might ease up on monetary tightening.
Data from the U.S. Bureau of Labor Statistics showed the economy generated 261,000 jobs in October. That was higher than an estimate of 200,000, but it also showed unemployment rising to 3.7pc from 3.5pc in September while wage inflation dropped to 4.7pc from 5pc in the earlier month.
“We definitely are seeing some early signs of pricing pressure coming down,” said Tom Plumb, portfolio manager at Plumb Balanced Fund in Madison, Wisconsin.
The MSCI index of global shares (.MIWD00000PUS), which tracks equities in 50 nations, broke two straight days of losses and was up 1.72pc. European stocks (.STOXX) also rallied 1.81pc, a day after falling on rate hikes from the Bank of England and the Fed.
Wall Street’s 3 major stock indexes closed higher, driven by technology, financials, consumer discretionary, communication services, and industrials.
The Dow Jones Industrial Average (.DJI) rose 1.26pc to 32,403.22, the S&P 500 (.SPX) gained 1.36pc to 3,770.55 and the Nasdaq Composite (.IXIC) added 1.28pc to 10,475.25.
Benchmark U.S. 10-year Treasury yields rose, with the notes at 4.1626pc.
“Even though the Fed would not talk about a pivot or anything like that, I think the market is expecting them to remain data dependent and in the next six months you’re going to see significant cracks in the pricing pressure,” Plumb said.
The U.S. dollar slumped after the employment report. The dollar index dropped 1.90pc, while the euro was up 2.1pc to $0.9956.
Safe-haven gold jumped more than 2pc as the dollar fell. Spot gold added 3.1pc to $1,680.33 an ounce, while U.S. gold futures gained 2.90pc to $1,672.50 an ounce.
Oil prices rose by 5pc amid the looming European Union ban on Russian oil and as investors weighed the implications of China’s easing of COVID restrictions. Brent crude futures settled up 5pc at $98.57 a barrel, while U.S. West Texas Intermediate (WTI) crude futures rose 4.98pc to $92.56 per barrel.
