Global shares climb after mixed US jobs data, oil stems losses

By Nell Mackenzie

LONDON (Reuters) -World shares rose on Friday, while the dollar fell and crude oil pared losses, after U.S. jobs data only slightly missed expectations, muddying the outlook on the size and speed of coming interest rate cuts in the world's largest economy.

A Labor Department report showed non-farm payrolls rose by 142,000 in August, compared with estimates of 160,000, as per economists polled by Reuters. July numbers were also revised down to 89,000.

However, the unemployment rate stood at 4.2%, in line with expectations. It stood at 4.3% a month earlier.

MSCI's broadest index of world shares rose 0.1%, hovering around a 2.5% drop for the week.

After the announcement, Wall Street futures regained some lost ground. Nasdaq futures retraced to negative 0.9%, while S&P futures were down 0.5%.

European shares also recovered some earlier losses during a fifth straight negative session, with the pan-European STOXX 600 index last down 0.1%.

Germany's DAX index remained down 0.6% after data showed the country's industrial production fell by 2.4% in July, compared with analysts' prediction of a 0.3% drop.

Federal Reserve Bank of New York President John Williams said on Friday a better balanced economy had opened the door to cutting rates, with the full course of action to be determined by how the economy performs.

“With the economy now in equipoise and inflation on a path to 2 percent, it is now appropriate to dial down the degree of restrictiveness in the stance of policy by reducing the target range for the federal funds rate,” Williams said in the text of a speech prepared for delivery before a gathering held at the Council on Foreign Relations in New York.

The yen was up 0.8% to 142.24 per dollar, eating into what before the announcement had been a weekly gain of roughly 2.6%.

Kristina Clifton, an economist at Commonwealth Bank of Australia (OTC:CMWAY ), noted that market caution in the lead up to the U.S. data had driven safe haven flows into the yen.

The U.S. Treasury yield curve switched out of inverted territory as Treasury yields slipped on Friday, extending their declines this week.

Two-year Treasury yields have fallen around 28 basis points (bps) so far this week to around 3.65% compared to ten-year yields at 3.67%.

Oil is facing the worst week since October 2023 as demand worries weigh against a big withdrawal from U.S. inventories and a delay to output increases by OPEC+ producers. [O/R]

Brent crude futures recovered some ground on Friday to be up around 48 cents at $73.13 a barrel, with West Texas Intermediate up 71 cents to 69.83.

Globally, jittery investors poured $61 billion into cash-like money market funds in the week to Wednesday, Bank of America said on Friday.

The Shanghai Composite index closed down 0.81% at 2,765.81 points, while the blue-chip CSI300 index ended 0.81% lower at 3,231.35 points. Both recorded their lowest closing levels since Feb. 5.

Hong Kong stock markets were shut ahead of Super Typhoon Yagi's expected landfall along the coast of Hainan province.



The Nikkei .N225 closed 0.72% lower at 36,391.47 points, after a weekly loss of more than 5% in its worst week since July 26, weighing on the outlook for Japanese exports.

Gold ticked up 0.4% at just over $2,526 an ounce.

Source: Investing.com