Stock market today: Asian shares climb after blockbuster US jobs report
Asian shares rose on Monday after a surprise move strong US jobs report generated optimism about the economy, leading to a rally on Wall Street.
US futures fell and oil prices also fell.
Japan’s Nikkei 225 index rose 1.9% to 39,354.63 after the yen fell against the US dollar. Since Prime Minister Shigeru Ishiba took office last week, the Japanese currency has rebounded on speculation about the central bank’s interest rate plans.
In one policy speech On Friday, Ishiba said he wants to see salary increases that exceed inflation and will promote investments to create “a virtuous cycle of growth and distribution.” He promised economic support for low-income households and measures for regional revitalization and disaster resilience.
But he offered no major new initiatives, and his initial public support is around 50% or lower, relatively low for a new leader, according to Japanese media. He plans to dissolve parliament on Wednesday for elections on October 27.
After rising against the dollar, the yen fell back at the end of last week. Early Monday, the dollar was trading at 148.57 yen, compared with 148.72 late Friday. Lower interest rates tend to increase the prices of stocks and other assets.
Elsewhere in Asia, Hong Kong’s Hang Seng index rose 1.4% to 23,056.53 and Seoul’s Kospi rose 1.1% to 2,597.34.
Taiwan’s Taiex gained 1.3%.
Markets in mainland China will reopen on Tuesday after a weeklong holiday, and the government said it plans to explain details of the plans economic stimulus at a morning press conference in Beijing. Before the Oct. 1 national holiday, policy announcements aimed at reviving the ailing real estate market pushed stock benchmarks sharply higher and could bring more volatility this week.
“More fiscal stimulus to stabilize the real estate market and restructure local government debt, and structural reforms to tackle the problems of overcapacity and deflation are needed to restart the economy,” B of A Securities said in a statement research note, pointing to continued declines. in house sales, house prices and credit growth.
On Friday the S&The P 500 climbed 0.9% and was close to its level all-time high on Mondayclosing at 5,751.07. The Dow Jones index rose 0.8% to 42,352.75 and the Nasdaq climbed 1.2% to 18,137.85.
The lead has been taken by banks, airlines, cruise ship operators and other companies whose profits stand to benefit most from a stronger economy where people work and are better able to afford things. Norwegian Cruise Line rose 4.9%, JPMorgan Chase rose 3.5% and small companies in the Russell 2000 index gained 1.5%.
Worries over tensions in the Middle East still cast a shadow as they have sent oil prices soaring as the world waits to see how Israel will respond on October 1st missile attack by Iran.
But U.S. crude fell 19 cents to $74.19 a barrel early Monday, while Brent crude, the international standard, lost 29 cents to $77.76 a barrel.
Treasury yields rose Friday after the U.S. government said employers added 254,000 more jobs to their payrolls last month than they eliminated. That was an acceleration from August’s hiring pace of 159,000 and exceeded economists’ forecasts.
Recently encouraging data on the economy has raised hopes that the labor market will hold up after the Fed pushes the button brake on the economy through higher rates to eradicate high inflation.
The Fed did that started lowering interest rates and Friday’s jobs report was so strong that traders are now predicting it won’t deliver another half-point rate cut before the end of the year, after doing so in September.
In other trades, the euro rose from $1.0967 to $1.0973 early Monday.