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Global stock markets posted modest
gains on Friday while US jobs data pointed to a possible soft patch for the
world’s top economy, dealers said.
Eagerly awaited job creation numbers missed analysts’ forecasts but “fit
into the current market narrative” that the US Federal Reserve will cut
interest rates this month, Markets.com analyst Neil Wilson said.
Interest rate cuts often boost share prices.
Asian indices had risen earlier in the day on news that the United States
and China are to resume high-level trade talks in October.
On Wall Street, the benchmark Dow added 0.3 percent, leaving it up 1.5
percent for the week.
In Washington, the Labor Department said employers added 130,000 net new
positions in August, far fewer than analyst forecasts for 171,000, while the
jobless rate held steady at 3.7 percent and wages rose.
The headline figure included 25,000 temporary jobs related to the upcoming
2020 population census, which meant hiring by private employers was even
weaker.
Data for the two previous months were revised lower as well. The numbers
suggest US economic activity is slowing down, reinforcing expectations of
interest rate cuts by the US Federal Reserve this year.
Speaking in Zurich, Fed Chairman Jerome Powell added to signals the Fed
will cut at its September 17-18 meeting.
The central bank will “continue to act as appropriate to sustain this
expansion,” he said, noting “significant risks” to growth, such as trade
conflicts and persistently low inflation.
– Shot in arm –
Meanwhile, after a tumultuous August, dealers got a shot in the arm this
week from news that Beijing and Washington plan to resume high-level trade
talks next month.
China’s commerce ministry said Vice Premier Liu He, Beijing’s point man on
trade, agreed to October talks in a call with US Trade Representative Robert
Lighthizer and Treasury Secretary Steven Mnuchin on Thursday.
This week also saw China flag plans for fresh economy-boosting measures.
“In recent months, there has been a lot of tough talk from both sides but
the prospect of the two sides sitting down, and holding trade talks has
lifted sentiment,” said David Madden, market analyst at CMC Markets UK.
“The trade spat has been going on for well over a year, and it is unlikely
to be wrapped up soon, but at the moment things are going in the right
direction.”
In Asia, Hong Kong finished up 0.7 percent, with dealers seeming to brush
off news that Fitch had downgraded its sovereign debt rating citing the
sometimes violent protests in the financial hub.
– Key figures around 2200 GMT –
New York – Dow: UP 0.3 percent at 26,797.46 (close)
New York – S&P 500: UP 0.1 percent at 2,978.71 (close)
New York – Nasdaq: DOWN 0.2 percent at 8,103.07 (close)
London – FTSE 100: UP 0.2 percent at 7,282.34 points (close)
Frankfurt – DAX 30: UP 0.5 percent at 12,191.73 (close)
Paris – CAC 40: UP 0.2 percent at 5,603.99 (close)
EURO STOXX 50: UP 0.3 percent at 3,495.19 (close)
Pound/dollar: DOWN at $1.2246 from $1.2334 at 2100 GMT
Euro/pound: UP at 90.65 pence from 89.46 pence
Euro/dollar: UP at $1.1097 from $1.1035
Dollar/yen: UP at 106.95 yen from 106.94 yen
Tokyo – Nikkei 225: UP 0.5 percent at 21,199.57 (close)
Hong Kong – Hang Seng: UP 0.7 percent at 26,690.76 (close)
Shanghai – Composite: UP 0.5 percent at 2,999.60 (close)
Brent North Sea crude: UP 59 cents at $61.54 per barrel
West Texas Intermediate: UP 22 cents at $56.52
(BSS)
