World stocks hold up after jobs report
LONDON(AP) — World stocks recovered yesterday after a disappointing US jobs report cemented market expectations that the Federal Reserve will introduce another batch of monetary easing measures next month.
While the prospect of more dollars in the system helped support stock markets, it kept the pressure on the US currency ahead of a key meeting of finance ministers in Washington, DC.
In Europe, the FTSE 100 index of leading British shares was down 23.77 points, or 0.4 percent, at 5,638.36 while Germany's DAX rose 11.38 points, or 0.2 percent, at 6,287.63. The CAC-40 in France was down 15.26 points, or 0.4 percent, at 3,755.21.
European stocks had been substantially lower and Wall Street futures had been predicting a retreat at the open following the news that overall non-farm payrolls in the US fell by a greater than anticipated 95,000 in September, despite a 64,000 increase in private sector jobs.
However sentiment has been shored up as investors now think it's a near certainty that the Fed will resume asset purchases to help the economy in the next few weeks — the most likely date is thought to be November 3 at the conclusion of its next rate-setting meeting.
Stocks have been buoyed since Tuesday's decision by the Bank of Japan to cut its interest rate to near zero percent and prepare a 5 trillion yen ($60 billion) fund to buy government bonds to prop up the faltering Japanese economy. Investors concluded that the Fed will likely be the next central bank to effectively start up the printing presses again.
While stocks have risen, the dollar has been hit hard by the prospect there will be more dollars swirling around the financial system.
Earlier in Asia, Japan's Nikkei 225 stock average lost 75.93 points, or 1.0 percent, to 9,588.88 amid renewed concerns over the yen's rise — on Thursday, the dollar dropped to a fresh 15-year low of 82.12 yen.
Shares in mainland China jumped, with investors playing catch-up as financial markets reopened after the weeklong National Day holidays. The Shanghai Composite index vaulted 3.1 percent to 2,747.80.
Hong Kong's Hang Seng index gained 0.3 percent to 22,944.18.