World stock markets advanced yesterday after US job growth posted its biggest increase in more than 1-1/2 years, but the US dollar slipped against most peers except the yen as slowing wage gains indicated only a gradual increase in inflation this year.
A planned meeting between North Korean leader Kim Jong Un and US President Donald Trump, and Kim’s pledge to refrain from further nuclear or missile tests during the proposed talks, buoyed investor sentiment, boosting stocks in Asia and giving support to crude futures after two negative sessions for oil.
Wall Street led global equity gains as the US labour data landed in a sweet spot for stock investors.
The Dow Jones Industrial Average rose 288.05 points, or 1.16 per cent, to 25,183.26, the S&P 500 gained 30.28 points, or 1.11 per cent, to 2,769.25 and the Nasdaq Composite added 90.43 points, or 1.22 per cent, to 7,518.37.
The pan-European FTSEurofirst 300 index rose 0.32 per cent and MSCI’s gauge of stocks across the globe gained 0.80 per cent.
Emerging market stocks rose 1.06 per cent. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.91 percent higher, while Japan’s Nikkei rose 0.47 per cent.
The yen fell sharply versus the US dollar after the Bank of Japan stuck to its dovish policy stance and as Mr Kim’s denuclearization pledge boosted risk assets.
Still, the greenback slipped against a basket of currencies as the slow US wage gains supported a view that the Federal Reserve would not quicken its pace of raising interest rates.
The Japanese yen weakened 0.66 per cent versus the greenback at 106.93 per dollar. The dollar index fell 0.14 per cent.
The euro up 0.09 per cent to $1.2321 while sterling was last trading at $1.3866, up 0.41 per cent on the day.
US Treasury yields advanced across the board after the strong jobs data.
Benchmark 10-year notes last fell 11/32 in price to yield 2.9048 per cent, from 2.866 per cent. The 30-year bond last fell 20/32 in price to yield 3.1655 per cent, from 3.132 per cent late on Thursday.
“The headline (payrolls) print is sort of a shockingly strong number, the guts of the report are as good,” said Tom Porcelli, chief US economist at RBC Capital Markets in New York.
US crude rose 2.86 per cent to $61.84 per barrel and Brent was last at $65.36, up 2.75 per cent on the day.