NEW YORK World equity markets rallied and the dollar strengthened on Friday after an unexpectedly sharp jump in US employment in February added to investor sentiment that the world’s biggest economy is gaining traction.
Wall Street pushed the Dow index to a fourth consecutive intraday record high, while European shares extended their gains to a session high on the increase in hiring, which pushed the US unemployment rate to a four-year low of 7.7 per cent.
The dollar touched a 3-1/2-year high against the yen and a three-month peak against the euro, while US Treasuries sank on the payrolls report.
Nonfarm payrolls surged by 236,000 jobs in February, the Labour Department said, handily beating economists’ expectations for a gain of 160,000.
“The US economy just hit it out of the park. The February non-farm payrolls data was expected to show the economy moving forward slowly but surely, not fast-forward like this,” said Jason Conibear, trading director at forex specialists Cambridge Mercantile in Toronto.
US stocks pared early gains, led by a decline in JPMorgan Chase, Bank of America and Goldman Sachs & Co.
The Dow Jones industrial average was up 41.58 points, or 0.29 per cent, at 14,371.07. The Standard & Poor’s 500 Index was up 3.54 points, or 0.23 per cent, at 1,547.80. The Nasdaq Composite Index was up 7.74 points, or 0.24 per cent, at 3,239.83. In Europe, the FTSEurofirst 300 index of top regional shares was up 0.8 per cent at 1,194.52.
Earlier, MSCI’s all-country world equity index rose to its highest level since late June 2008, and Japan’s Nikkei hit a 4-1/2 year high in Asian trading.
The euro fell against the dollar, erasing gains from Thursday, when European Central Bank President Mario Draghi gave less-dovish policy signals than expected. The euro fell 0.9 per cent to $1.2986.
Against the yen the dollar climbed as high as 96.54 yen, the highest since August 2009. It was last at 96.15 yen, up 1.4 per cent in its biggest one-day gain since February 11.
Brent crude oil futures fell below $110 a barrel, pressured by a stronger dollar after the US jobs report, higher-than-expected supply from the North Sea and Opec, and investors selling out of commodities in favour of equities.
Brent futures were down $1.25 to $109.90 a barrel.
