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US payrolls rise 236k in March versus 239k estimates
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Dollar strengthens, US yields rise
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Nikkei, S&P futures close higher
By Chuck Mikolajczak
NEW YORK, April 7 (Reuters) – US Treasury yields rose and US index futures ended slightly higher after March jobs data suggested the job market remained tight but was broadly in line with market expectations.
Nonfarm payrolls rose by 236,000 jobs last month, the Labor Department said, compared with an expectation of 239,000 by economists polled by Reuters.
Data for February has been revised upwards to show 326,000 jobs were added instead of 311,000 as previously reported. The unemployment rate fell to 3.5% from 3.6% in the previous month.
US stock index futures recouped losses and rose after the report, while the dollar strengthened and US Treasury yields rose on mounting expectations that the US Federal Reserve will hike interest rates at its May meeting.
“Obviously the headline count is basically the exact estimate. There really isn’t anything here that wasn’t where consensus was,” said Alex Coffey, senior trading strategist at TD Ameritrade in Chicago.
“We have kind of a situation where this doesn’t change the game, allows us to move on to the next data point and that lack of surprise is seen as optimism.”
The US stock market is closed until Monday for the Good Friday holiday. European markets are closed on both Friday and Monday.
The MSCI measure of equities around the world lost 0.01%. E-mini futures for the S&P 500 closed up 0.23% after the data.
In Asia, Japan’s Nikkei stock average rose on Friday, muting its weekly decline as a weaker yen and a higher close on Wall Street overnight boosted sentiment ahead of the payroll report.
Still, the jobs report boosted expectations that the Fed will hike rates at its next meeting, with the market pricing in a 69% chance of a 25 basis point rate hike, up from 49.2% on Thursday, according to CME’s FedWatch tool.
The story goes on
“While payroll headline counts are still high, hours are being slashed, with the aggregate weekly hours index falling for two straight months,” said Brian Jacobsen, senior investment strategist at Allspring Global Investments in Menomonee Falls, Wisconsin.
“The employment situation has gone from red hot to just smoldering.”
Benchmark 10-year bonds rose 8.9 basis points to 3.379% from 3.29% late Thursday.
The US two-year Treasury yield, which normally moves in step with interest rate expectations, rose 15.3 basis points to 3.974%.
The dollar index rose 0.167%, while the euro fell 0.13% to $1.0906. (Reporting by Chuck Mikolajczak; Editing by Jan Harvey)
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