Asia Morning: US Jobs Surge Boosts Market Optimism

Wall Street sign with a building in background
On Friday, U.S. stocks jumped on an unexpected surge in May jobs. The Dow Jones Industrial Average gained 829 points (+3.2%) to 27111, the S&P 500 rose 81 points (+2.6%) to 3193 and the Nasdaq 100 increased 194 points (+2.0%) to a record high of 9824.


Source: GAIN Capital, TradingView


Energy (+7.46%), Automobiles & Components (+6.25%) and Banks (+4.86%) sectors gained the most. 

Stocks in the oil sector such as Occidental Petroleum (OXY +33.28%), Apache (APA +23.15%) and Marathon Oil (MRO +17.34%) were top gainers as oil prices rallied.

On the technical side, about 50.6% (51.4% in the prior session) of stocks in the S&P 500 Index were trading above their 200-day moving average, and 91.5% (94.9% in the prior session) were above their 20-day moving average.

U.S. official data showed that the economy added 2.509 million nonfarm payrolls in May, in sharp contrast to a reduction of 7.500 million jobs expected. The jobless rate also unexpectedly dropped to 13.3% (19.0% expected).

European stocks were sharply higher, with the Stoxx Europe 600 Index jumping 2.5%%. Germany's DAX surged 3.4%, the U.K.'s FTSE 100 rose 2.3% and France's CAC was up 3.7%.

Prices of safe-haven assets, such as U.S. Treasuries and gold, were weighed down by growing risk appetite in the market. The benchmark 10-year Treasury yield jumped to 0.903% from 0.826% Thursday. Spot gold price slumped $31.00 (-1.8%) to $1,631, a one-month low.

U.S. WTI crude oil futures (July) surged 5.7% to a three-month high of $39.55 a barrel. Over the weekend, The Organization of the Petroleum Exporting Countries and its allies (OPEC+) agreed to a one-month extension of oil-production cuts.

On the forex front, the ICE U.S. Dollar Index rebounded 0.3% on day to 96.95, lifted by a surprising increase in U.S. nonfarm payrolls.

EUR/USD retreated 0.5% to 1.1286, halting an eight-day rally. Official data showed that German factory orders sank 25.8% on month in April (-19.9% expected).

GBP/USD rose 0.6% to 1.2665, the highest level since mid-March.

USD/JPY advanced 0.4% to 109.59, rising for a fourth straight session. This morning, government data showed that Japan's final readings of first quarter annualized GDP posted -2.2% on quarter (-2.1% expected).

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