Global stocks rallied and U.S. Treasuries and gold sold off as the latest non-farm payroll report showed that U.S. employers added 253,000 new jobs in April, exceeding expectations for 180,000 and up from 165,000 in March.
U.S. Treasury yields rose, while the dollar was down slightly against a basket of major currencies. Oil prices jumped on signs of economic strength, but recorded their third weekly decline in a row. U.S. bank shares also erased some losses after a rough week following the collapse of a third major bank.
Traders pared expectations of Federal Reserve easing after a long spate of rate hikes, as strong U.S. jobs data brightened the economic outlook. Since Fed Chair Jerome Powell signaled that the central bank could pause hikes, traders have been betting this would happen at the June meeting with some even calling for rate cuts in July. After Friday’s data, the probability for a July cut declined.
MSCI’s gauge of stocks across the globe was up 1.48% and on track for its biggest one-day percentage gain since January 6, but still showed a small decline for the week. The Dow Jones Industrial Average rose 1.65%, the S&P 500 gained 1.85%, and the Nasdaq Composite added 2.25%.