Stocks climb after weak US jobs data, but bonds resume selling
SPY•Major stock indexes rose and the dollar fell after US payrolls increased by 29,000, below the expected 90,000, while Treasury yields resumed rising. Traders saw a 21% chance of a Federal Reserve rate hike in October, down from 26% before the report.
1. Stocks rise after jobs data
US stocks rose Friday after payrolls increased by 29,000 last month, missing economists’ expected 90,000. August job growth was revised down to 133,000 from 162,000. The Nasdaq gained 1.2%, the S&P 500 rose 0.7% and the Dow advanced 0.5%.
2. Rate hike bets ease
Traders saw a roughly 21% chance of a 25-basis-point Federal Reserve rate hike in October, compared with about 26% before the report. Treasury yields initially fell after the data but later rose: the 10-year yield was up 4.93 basis points at 5.283%, and the two-year yield gained 4.6 basis points to 4.833%.
3. Bond markets remain volatile
The dollar weakened against the euro and yen. In Europe, the gap between German and French 10-year yields reached its widest level since 2011. Brent crude rose 0.45% to $102.77 a barrel, while West Texas Intermediate fell 1% to $91.90.
