Global shares edge up after US jobs data underscores post-pandemic recovery, while inflation concerns ease

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Global shares edge up after US jobs data underscores post-pandemic recovery, while inflation concerns ease
JOHANNES EISELE/AFP via Getty Images
  • US futures rose on Friday after a strong read of the US jobs market added to economic optimism.
  • Falling Treasury yields eased inflation concerns and took pressure off tech stocks.
  • Gold's rally continued as crypto markets continued to struggle after their midweek tumble.

Global shares edged higher on Friday after weekly initial jobless claims in the US reached a new post-pandemic low, underscoring the strength of the post-pandemic recovery.

The surprisingly stronger data helped soothe some concern that April's shock report on the broader labor market was a one-off and did not reflect an unwelcome slowdown in hiring.

Treasury yields fell after the Federal Reserve's April meeting minutes on Thursday helped ease investors' concerns about inflation that had dominated markets throughout the week. This took pressure off some of the pricier sectors of the market, such as tech stocks and led major indices including the S&P 500, Dow Jones and Nasdaq 100 to finish higher on Thursday.

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"But to be honest, we can't help but feel a sense of déjà vu here, as last week both indices saw the same pattern of losses on Monday, Tuesday and Wednesday, before rising again on Thursday and Friday. So if we get another day in the green today we'll know this is Groundhog Week," Jim Reid, research strategist at Deutsche Bank, commented.

Nasdaq 100 futures were last up 0.23%, leading US futures positive trend. S&P 500 futures had last risen by 0.11% and Dow Jones futures were almost flat, having gained 0.07%.

Yield on the US 10-year Treasury note was last at 1.618%, down 1.6 basis points.

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European markets had a mixed start on Friday, as a flurry of economic data hit markets, including a first glance at manufacturing and services activity in May.

The German DAX and Euro Stoxx 50 were last up 0.1%, while London's FTSE 100 was last down 0.51% despite UK retail sales exceeding expectations in April and jumping by 9.2% compared to an expected 4.5%.

The cautious reaction was "characteristic" of the week, Michael Hewson, chief market analyst at CMC Markets said, as "investors wrestle with indecision about the direction of the next move, caught between optimism over the economic reopening, and concern over central banks acting too late to address an inflationary surge."

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Cryptocurrencies continue to struggle after a tumultuous week. Bitcoin edged above the $40,000 mark, having gained 0.2% in the 24 hours to 04:20 E.T., when it was trading at $40,010.20. Earlier this week, it fell to just above $30,000 before recovering some ground.

Others, including the second-largest cryptocurrency ether, continued to fall. Ether was last at $2,682.32, down 0.98% in the 24 hours to 04:24 E.T..

Gold edged lower on the day, but still headed for a third successive weekly gain. The price was last at $1,877.70, down 0.2%. The metal has been supported by falling US Treasury yields and a weaker dollar, which makes it cheaper for non-US investors to buy it.

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Oil prices fell as markets prepared for an influx of Iranian crude after the country's president said sanctions were likely to end. Brent crude was last trading at $65.03 per barrel, down 0.12% and WTI crude was last priced at $62.01 per barrel, up 0.11%. Both fell by more than 2% on Thursday.

Asian markets had a mixed end to the week as Hong Kong's Hang Seng index closed 0.1% higher, the Japanese Nikkei 225 rose by 0.78% and China's Shanghai Composite fell by 0.58% on Friday.

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