High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/0/e4b939f4-0b2d-11e5-98d3-00144feabdc0.html#ixzz3cBxDEvDn Friday 13:40 BST. European stocks are lower, the dollar and bond yields are moving higher, after new data showed sturdy growth in the US job market. Asia-Pacific bourses were mostly softer, though China finished the week at a fresh seven-year high. Oil prices are firmer after Opec maintained production levels. High quality global journalism requires investment. Please share this article with others using the link below, do not cut & paste the article. See our Ts&Cs and Copyright Policy for more detail. Email ftsales.support@ft.com to buy additional rights. http://www.ft.com/cms/s/0/e4b939f4-0b2d-11e5-98d3-00144feabdc0.html#ixzz3cBxHXG9P The US Labor Department said a net 280,000 jobs were created in May, easily beating analyst expectations of a 225,000 gain. The unemployment rate is 5.5 per cent, while average wage growth hit 0.3 per cent, both 0.1 per cent above forecasts. The news suggests the world’s biggest economy is accelerating away from its first quarter soft patch, a trend that makes it more likely the Federal Reserve will start this year raising interest rates from their record lows. This reasoning is making fixed income assets less attractive and pushing up bond yields, which move inversely to the price. The policy-sensitive 2-year Treasury yield is up 6 basis points to 0.72 per cent, while the 10-year Treasury yield is up 10bp to 2.41 per cent, their highest since October. The buck is getting a boost, adding 1.1 per cent versus the euro to $1.1116 and gaining 1 per cent against the yen to Y125.54, a fresh 12-year high relative to the Japanese unit. But the firmer dollar and rising implied borrowing costs are being eyed warily by US equity investors. S&P 500 futures indicate the Wall Street benchmark will ease another 2 points to 2,094, following an 18 point loss in the previous session. Gold also tends not to like a stronger greenback and higher borrowing costs, and the bullion is off $9 to $1,167 an ounce, a near three-month low. The jump in US yields is helping underpin the recent surge in German peers. Ten-year Bund yields touched a record low of just 0.05 per cent seven weeks ago, suppressed by fears of eurozone deflation and as the European Central Bank undertook its €60bn a month bond buying programme. But they are now 0.91 per cent, up 8bp on the day, as investors continue to reverse their “long� Bund trade in the wake of recent better economic eurozone data and a warning from European Central Bank president Mario Draghi that the market should expect more volatility in fixed income. Like Wall Street, European stocks are not happy with the rising bond yields — the FTSE Eurofirst 300 is falling 0.7 per cent, though losses have been pared with help from the weakening euro. The single currency also remains pressured by investor wariness over the tortuous “cash for reforms� negotiations between Greece and its creditors. “The gap [between both sides] is still substantial and we believe bridging it may take longer than many expect,� said analysts at Barclays. “We think a compromise on policies by the Greek government could trigger a political crisis that could accelerate deposit outflow and result in the imposition of administrative controls on Greek banks.� Indeed, the domestic political repercussions of the stand-off were highlighted on Friday by Greece’s deputy prime minister saying the country may have to hold a snap election. The Athens stock market is down 5.1 per cent as the government’s 10-year borrowing costs jump 68bp to 11.40 per cent. As the dollar index adds 0.9 per cent to 96.35 it weighs on dollar-denominated commodities, with base metals struggling to gain ground. However, oil is bucking the trend as Brent crude adds 0.7 per cent to $62.48 a barrel after Opec maintained production levels. In Asia, China’s benchmark stock index hit a new seven-year high, as the country’s bull run rumbled on. The Shanghai Composite gained 1.5 per cent to top the 5,000-mark for the first time since early 2008, as turnover rose 74 per cent above the 100-day average. “The scale and speed of these gains scream ‘speculative bubble’,� said Richard Iley at BNP Paribas, as the advance took year-to-date gains in Shanghai to more than 55 per cent. Margin lending in China is approaching 3.5 per cent of GDP — a level exceeding the US, which is also at a record high, Mr Iley noted. The fear of curbs to margin lending was responsible for a 5 per cent intraday sell-off on Thursday before the index recouped all its losses; similar worries sent the index down 6.5 per cent a week earlier. The rest of the region was in a fairly sour mood. Japan’s Nikkei 225 fell 0.1 per cent and Hong Kong’s Hang Seng index retreated 1.1 per cent, while South Korea’s Kospi Composite slipped 0.2 per cent. In Australia, the S&P/ASX 200 dropped 0.1 per cent, a fifth straight decline.

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