TOKYO (Reuters) – Global stock prices rose to a 1/2-month high on Monday after data showed an increase in US employment, while US bonds came under pressure over concerns that the Federal Reserve raised interest rates can push up as indicated.
U.S. S & P500 futures traded 0.3% higher, while most of their gains were maintained during a cut-off session on Friday, although the heavy Nasdaq futures trailed behind and almost traded.
In Asia, the Nikkei rose 0.8% in Japan, while MSCI’s widest index of Asia Pacific stocks slipped slightly outside Japan, with China closing on Tomb Sweeping Day and Australia closing on Easter Monday.
MSCI’s world index for all countries was almost flat, but has stood near its highest level since late February and is in sight of a record high in the month, although trading remains slow, with much of Europe on holiday.
The U.S. Department of Labor said Friday that non-farm payrolls rose 916,000 jobs last month, the largest gain since last August.
It was well above the average forecast of economists of 647,000 and was closer to the whisper number of one million. The data for February were also revised higher to indicate that 468 000 jobs were created instead of 379 000 previously reported.
‘There will be further improvements in April as restaurants reopen. “People expected economic normalization to happen sooner or later, but it seems to be accelerating,” said Koichi Fujishiro, senior economist at Dai-ichi Life Research.
Although employment will remain below its peak of 8.4 million jobs in February 2020, an accelerated recovery has raised hopes that all jobs lost during the pandemic could be restored by the end of next year.
The prospect of returning to full service, in turn, raises questions about whether the Fed can keep its promise to keep interest rates until 2023.
Markets have high doubts, and the futures of Fed funds by the end of next year in one rate hike.
Many players in the market also expect the Fed to look at reducing its bond purchases this year, although Fed officials have said it has not yet discussed the issue.
“It will be impossible for the Fed to avoid talks by the fall,” said Kozo Koide, chief economist at Asset Management One. He noted that US President Joe Biden’s plan for spending on infrastructure is likely to be so far.
The two-year U.S. Treasury yield rose to 0.186%, close to its eight-month peak of 0.194% that hit the end of February.
Yields on longer-dated bonds also rose, with a 10-year high of 1.725% in Asia on Monday, extending the rise that began Friday after the job report.
The strong job data supported the dollar.
The greenback traded at 110.65 yen, not far from Wednesday’s one-year high of 110.97. The euro was $ 1.1752.
Gold slipped 0.4% to $ 1,724.70.
In cryptocurrencies, ether fell 1.7% to $ 2,040.21 from Friday’s record high of $ 2,144.99. Bitcoin dropped 0.9% to $ 57,704.
Oil prices have fallen, with strong gains made in the previous session, driven by OPEC +’s decision to gradually ease some of its production cuts between May and July.
“Although the market initially rose with the news, it will still be a production increase,” said Tatsufumi Okoshi, senior commodity analyst at Nomura.
The decision came after the new US government asked Saudi Arabia, the world’s largest oil exporter, to keep energy affordable for consumers.
U.S. energy companies have also been adding the most oil platforms in a week since January 2020, as higher oil prices have allowed natives to return to the well in recent months.
U.S. crude futures fell 1.4% to $ 60.62 a barrel while Brent fell 1.4% to $ 63.95.
Reporting by Hideyuki Sano, Editing by Gerry Doyle