Stocks Rise As US Jobs Data Reassures Investors

A string of data this week pointing to a softening of the labour market and economy have given the Federal Reserve room to hold off hiking rates further AFP

Stock markets mostly rose and the dollar dipped Friday after a US jobs report helped solidify expectations of a pause in US interest rate hikes.

An increase of 187,000 jobs in August was slightly larger than analyst expectations, but the figures for the previous two months were revised significantly lower, which overall pointed to a slowdown in the job market.

Moreover, wage growth slowed.

Briefing.com analyst Patrick O'Hare called it "a Goldilocks report as it pertains to the market's thinking that the Fed won't be raising rates again."

The non-farm payroll report followed a series of data showing signs the world's top economy is softening, and thus easing pressure on the Federal Reserve to lift interest rates further to fight high inflation.

Wall Street's main stock indices rose at the start of trading.

The Dow and the broader S&P 500 both climbed 0.6 percent and the tech-heavy Nasdaq rose 0.8 percent.

The dollar fell further against major rival currencies after the payroll data was released.

European stocks were mostly higher in afternoon trading.

Other data this week on job openings, factory activity and economic growth, among other things, have fuelled optimism that the US central bank would not need to tighten monetary policy any more.

Analysts said, however, that there was an acceptance that rates would likely stay elevated for some time as more than a year of increases is allowed to work through the system, with no cuts seen for some time.

Investors were also assessing China's latest moves to help the country's battered property sector as authorities face growing calls to introduce a big-bang economic growth stimulus.

Chinese markets were lifted after the central bank cut the amount of foreign cash lenders must keep in reserve, in a bid to support the yuan.

Dealers also cheered the latest measures to help the property sector, which allow cities to cut down-payments for home buyers and encourage lenders to lower rates on existing mortgages.

The moves follow a series of pledges in August to shore up the industry, which is being ravaged by a gargantuan debt crisis.

Among them are rate cuts, lower rules for mortgage applicants, tax rebates for people upgrading their homes and a cap on commissions.

But observers say traders were unlikely to drag markets out of their slumber unless the government unleashes the sort of $550 billion "bazooka" seen in 2008 during the global financial crisis.

Data Thursday showed a massive plunge in sales in August, while developers are on the brink, with the biggest, Country Garden, close to default.

Oil prices rose strongly, with the main US contract hitting $85 per barrel for the first time since November thanks to a weaker dollar and supply concerns.

New York - Dow: UP 0.6 percent at 34,926.92 points

London - FTSE 100: UP 0.5 percent at 7,479.14

Frankfurt - DAX: DOWN less than 0.1 percent at 15,937.73

Paris - CAC 40: UP 0.4 percent at 7,348.58

EURO STOXX 50: UP 0.4 percent at 4,312.51

Tokyo - Nikkei 225: UP 0.3 percent at 32,710.62 (close)

Shanghai - Composite: UP 0.4 percent at 3,133.25 (close)

Hong Kong - Hang Seng Index: Closed for typhoon

Euro/dollar: UP at $1.0866 from $1.0844 Thursday

Pound/dollar: UP at $1.2692 from $1.2669

Dollar/yen: DOWN at 144.89 yen from 145.49 yen

Brent North Sea crude: UP 1.3 percent at $87.92 per barrel