In Asian Equity Markets stocks rose sharply on Monday amid optimism over a potential economic recovery in China, while softer-than-expected U.S. jobs data also saw investors pricing in the possibility of less severe interest rate hikes by the Fed. Chinese and China-focused stocks were the best performers for the day, with Hong Kong’s Hang Seng index rallying 1.7 percent to a near six-month high, while South Korea’s KOSPI jumped 2.4 percent. China’s Shanghai Shenzhen CSI 300 and Shanghai Composite indexes rose 0.7 percent and 0.5 percent, respectively.
In Currency Markets the U.S. dollar was steady on Monday as investors digested a clutch of economic data released last week that stoked hopes of the Fed slowing the pace of its interest rate hikes. The Japanese yen strengthened 0.12 percent versus the U.S. currency to 131.94 per dollar, while sterling was last trading at $1.2099, up 0.06 percent on the day, having gained 1.5 percent on Friday. The euro was up 0.11 percent at $1.0656, after closing 1.17 percent higher on Friday. The Australian dollar rose 0.17 percent versus the U.S. currency to $0.689, while the kiwi gained 0.02 percent to $0.635.
In US Equity Markets main indexes all gained more than 2 percent on Friday after December payrolls expanded more than expected even as wage increases slowed and services activity contracted, easing worries about the Federal Reserve’s interest rate hiking path. The Dow rose 2.13 percent, to 33,630.61; the S&P 500 gained 2.28 percent, at 3,895.08; and the Nasdaq Composite added 2.56 percent, at 10,569.29. Consumer staples was boosted by Costco Wholesale Corp, whose shares jumped 7 percent after the membership-only retailer reported strong December sales growth.
In Commodities Markets oil prices were little changed on Friday as the market balanced a weaker U.S. dollar and mixed U.S. jobs reports, but both crude benchmarks ended the first week of the year lower due to global recession concerns. Brent futures fell 0.2 percent, to settle at $78.57 a barrel, while U.S. WTI crude rose 0.1 percent, to settle at $73.77. Spot gold jumped 1.9 percent to $1,867.18 per ounce. Spot silver rose 2.8 percent to $23.87 per ounce but is set for a weekly fall. Platinum was up 3.1 percent to $1,091.12 and palladium gained 3.4 percent to $1,804.00, both set for weekly rises.
In European Equity Markets stocks closed at seven-month highs on Friday, boosted by miners and oil stocks, while data pointing to a moderation in U.S. jobs growth helped calm nerves over the Federal Reserve’s rate-hike trajectory. The continent-wide STOXX 600 index closed 1.2 percent higher, its highest level since May. Shell rose 1.7 percent after the oil major said earnings from its natural gas trading operations were likely to have risen significantly in the fourth quarter of last year, despite a sharp output decrease due to plant outages.
In Bond Markets U.S. Treasury yields fell on Friday after data showed signs of an economy slowing down as wages rose less than expected last month even though new jobs increased more than anticipated, while the U.S. services sector shrank for the first time in more than 2-1/2 years. In afternoon trading, U.S. 10-year yields slid to two-week troughs of 3.551 percent. The yield was last down 16.6 bps at 3.556 percent. U.S. 30-year yields also declined to a two-week low of 3.671 percent, last down 11.6 bps at 3.682 percent. U.S. two-year yields also lost to the lowest in two weeks of 4.245 percent.