Non-farm payrolls in the United States jumped 916,000 more than expected last month, signaling an increase in economic activity.
On Monday, Global stock prices hit a 1.5-month high, following data on US jobs. Simultaneously, short-term US bonds came under pressure amid fears the Federal Reserve does not raise interest rates sooner than it has.
On Friday, The US S&P 500 futures traded 0.5% higher, maintaining their gains in a short session, while Japan’s Nikkei climbed 0.8%.
Outside of Japan, Asia Pacific stocks’ broadest MSCI index was almost flat, With Easter Monday Australia closing for China Gravescope Day.
MSCI’s global index for all countries was little changed but is near its highest level since late February and preparing a record high that month.
The US Department of Labor said Friday that the non-farm payroll – jobs outside the farm sector – jumped 916,000 last month, the biggest gain in new jobs since last August.
This is much better than the average economist’s estimate of 647,000. The February figures were also revised to show 468,000 jobs, up from 379,000 previously.
Chief strategist at Sumitomo Mitsui DS Asset Management, Masahiro Ichikawa, said, The data has confirmed that US economic activity is back as coronavirus vaccinations are well advanced.
Speed up recovery
With less than 8.4 million jobs in February 2020, a rapid recovery has raised hopes that all jobs lost during epidemics could be recovered by the end of the year.
As a result, the prospect of a full-blown job raises the question of whether, until 2023, the Federal Reserve can keep its promise to keep interest rates low.
Markets are skeptical of the total cost of raising Federal Reserve funds by the end of next year.
Sumitomo Mitsui’s Ichikawa said Markets are certainly not convinced that the Fed can be comfortable when we have robust job data. At the same time, the government comes up with another significant stimulus.
The two-year US Treasury yield fell to 0.186 to close at an eight-month high of 0.194 at the end of February.
Longer-term bond yields were more subdued, with the 10-year note yield slipping to 1.706% on Monday, relinquishing part of its four basis point hike made on Friday after the jobs report.
Robust job data helped support the dollar.
The greenback traded at 110.72 yen, near Wednesday’s one-year high of 110.97. The euro stood at $ 1.1762.
Among crypto assets, Ether was valued at $2,075.67, near Friday’s record high of 2,144.99.
Bitcoin stood at $ 58,146 after gains of 4.3% last week.
Oil prices fell last week after the world’s largest crude exporters agreed to cut production between May and July.
US crude futures fell 0.5% to $ 61.16 a barrel.