U.S. Stocks Set Record, Dollar Gains on Jobs Data: Markets Wrap

  • Evidence of healthier economy keeps Trump-rally thesis alive
  • Treasury rebound is undercut by sixth year of labor gains

Bill Gross: Jobs Number 'Decent,' Economy Improving

Fresh signs of strength in the U.S. labor market reignited the dollar rally and sent U.S. stocks to all-time highs, with the Dow Jones Industrial Average climbing within one point of 20,000. Treasuries tumbled with gold as data bolstered the case for higher interest rates.

The S&P 500 Index closed at a record for the first time since Dec. 13. The Dow finished 33 points from the round-number milestone to cap its best week in a month. The Bloomberg Dollar Spot Index halted a two-day slide, rising toward a 14-year high. The yield on the 10-year Treasury note jumped after falling nine basis points Thursday. Oil slipped and gold retreated from a four-week high.

Evidence of a healthy U.S. labor market helped the dollar recoup some losses as investors speculated growth in the world’s largest economy is poised to accelerate. Equities broke above a monthlong range after a post-election rally stalled when the Fed raised rates and doubts arose that Donald Trump will usher in an era of higher government spending.

Mohamed El-Erian said in a Bloomberg TV interview that the jobs report will encourage the Fed to proceed with raising interest rates, though he cautioned that a strong dollar could weigh on growth.

Read more from our Markets Live blog here.

Stocks

  • The S&P 500 rose 0.5 percent a record 2,279.28 at 4 p.m. in New York. It added 1.7 percent in the week, the most since Dec. 9.
  • The Nasdaq Composite and Nasdaq 100 indexes advanced at least 0.6 percent, with both closing at all-time highs.
  • The Dow climbed to 19,965.50, about 10 points below its record close. It set an intraday high of 19,999.63, and capped a weekly gain of 1 percent.
  • The MSCI All-Country World Index slipped 0.1 percent to pare a weekly gain to 1.7 percent.
  • The Stoxx Europe 600 Index fell 0.1 percent, trimming a weekly advance, as commodity producers declined.

Currencies

  • The Bloomberg Dollar Spot Index rose 0.6 percent after falling 1 percent Thursday. It is little changed for the week.
  • The offshore yuan fell 0.6 percent to 6.8304 per dollar after a four-day climb.
  • The euro dropped 0.7 percent to $1.0534 and the pound retreated 1.1 percent to $1.2288.
  • Canada’s dollar was little changed at C$1.3263 against its U.S. counterpart after the country posted its first trade surplus in more than two years and full-time jobs surged.
  • Turkey’s lira was down 1.4 percent after touching a record low Thursday.

Commodities

  • Crude was little changed at $53.74 a barrel in New York. U.S. government data showed strong job and wage gains while Kuwait and Saudi Arabia signaled they are curbing output.
  • Gold futures fell 0.8 percent to $1,172.50 an ounce.
  • Copper slipped 0.6 percent and natural gas futures slid 0.7 percent.

Bonds

  • The biggest rally in U.S. Treasuries since June 27 was brought up short, with the yield on the 10-year benchmark up rising back above 2.40 percent after sliding nine basis points Thursday.
  • The two-year yield jumped five basis points to 1.21 percent.

— With assistance by Natasha Doff, Cecile Gutscher, Eddie Van Der Walt, V Ramakrishnan, and Namitha Jagadeesh

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