NEW YORK, June 3 (Reuters) – Global stock markets plunged as US Treasury yields hit a two-week high on Friday after data showed that the US economy created more jobs than expected in May. Raises interest rates in an effort to control inflation.
The Labor Department’s closely watched employment report added that the U.S. economy added 390,000 jobs in May, and the unemployment rate remained stable at 3.6% for the third month, beating most analysts’ estimates. read more
Traders hoped that the employment report would show strong signs of weakness in the US economy, which could help force the central bank to soften its stance on inflation and interest rates to avoid triggering a recession.
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“Apart from retail, it was strong, and the jobs-leading economy continues to move forward,” said Josh Wayne, portfolio manager for Hennessy Funds in Chapel Hill, North Carolina. “The federal government still needs to clear the demand a little bit, and they’re going to pursue it for at least the next few meetings with a 50 point rate hike.”
MSCI Global Equity Code (.MIWD00000PUS)Shares in 50 countries traded down 1.14%. Pan-European STOXX 600 Index (.STOXX) Decreased by 0.26%.
After strong jobs data, U.S. Treasury yields advanced to a two-week high. The benchmark 10-year index rose 2.946% and the two-year benchmark index rose 2.6606%.
On Wall Street, all three major indices fell, with sales-offs in the technology, consumer preferences, communications services, finance and industry sectors. read more
Dow Jones Industrial Average (.DJI) The S&P 500 was down 1.05% at 32,899.7 (.SPX) Lost 1.63% to 4,108.54 and the Nasdaq joint (.IXIC) Was down 2.47% to 12,012.73.
“There was some rally (in equities) that came late because the central bank agreed that they could revaluate and suspend in the fall. But the market is recovering some of their previous losses and basically saying it was off the table.” Wein said.
The US dollar rose against a basket of currencies after the employment report. The dollar index was up 0.393% and the euro was down 0.25% at $ 1.0718. read more
OPEC’s decision to increase production targets slightly more than planned will not affect tight global distribution much, and oil prices have risen as demand has increased as China relaxes controls over the COVID-19 epidemic. read more
Brent crude was up 1.8% at $ 119.72 a barrel and US West Texas Intermediate was up 1.7% at $ 118.87. Both benchmarks rose above $ 3 in hourly trading.
The price of gold fell by almost 1% after the appeal of gold fell due to the rise of the US dollar and treasury yields following strong jobs data.
Spot gold was down 0.9% at $ 1,850.57 an ounce and US gold futures were down 0.99% at $ 1,848.10 an ounce.
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Sibuk Oku’s report in New York; Editing by Jonathan Odyssey and Will Dunham
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