U.S. jobs grow faster than expected, wages increase
S&P regains some ground after selling off on jobs data
Euro gains on dollar but trades below its 5-month high
Oil traders focus on Sunday's OPEC+ meeting
NEW YORK, Dec 2 (Reuters) - U.S. Treasury yields were
lower and Wall Street's benchmark S&P 500 ended down but well
above the day's lows on Friday as investors digested a stronger
than expected jobs report, which had raised concerns about the
Federal Reserve's ability to slow rate hikes.
The U.S. Labor Department reported that nonfarm payrolls
increased by 263,000 jobs last month compared with economist
expectations for 200,000 jobs. And average hourly earnings
increased 0.6%, up from 0.5% in October.
The report - released two days after Fed Chair Jerome Powell
said it could be time to slow the pace of rate hikes - made
investors question whether the central banker would be able to
follow through on his suggestion.
Still, the S&P 500 closed down 0.12%, compared with
its earlier decline of 1.23% in morning trading.
The stock market's turnaround on Friday showed that the
sentiment boost from Fed meeting minutes last week and Powell's
comments Wednesday had "put the bulls firmly in charge,"
according to Michael James, managing director of equity trading
at Wedbush Securities in Los Angeles.
"That sentiment shift has been more powerful than any
'negativity' to be taken from today's jobs report," he said.
However, while Chicago Federal Reserve Bank President
Charles Evans made comments Friday that the Fed will probably
reach a slightly higher peak funds rate, he still talked about
stepping down the pace of rate hikes from recent 75-basis-point
After the payrolls report traders were betting that the Fed
would raise its policy rate from the 3.75%-4% range implied
earlier to 4.92% by March 2023 and to the 5%-5.25% range by May,
based on futures contract prices and the CME Fedwatch tool.
Before the report, the rate was seen topping out at 4.75%-5%.
The Dow Jones Industrial Average rose 34.87 points,
or 0.1%, to 34,429.88, the S&P 500 fell 4.87 points to
4,071.7 and the Nasdaq Composite dropped 20.95 points,
or 0.18%, to 11,461.50.
The S&P, Nasdaq and the Dow all boasted their second
weekly gains in a row, while the Nasdaq led the charge with a 2%
advance. The S&P added 1% for the week while the Dow was up
MSCI's gauge of stocks across the globe
shed 0.15% on the day but added 1.5% for the week.
The dollar gradually gave back its gains following Evans'
comments. Earlier it had jumped sharply in response to the jobs
data, gaining as much as 0.82%.
Recently, the dollar index, which measures the
greenback against a basket of major currencies, was down 0.143%,
with the euro up 0.14% to $1.0537.
The Japanese yen strengthened 0.77% versus the greenback at
134.27 per dollar, while Sterling was last trading at
$1.2279, up 0.21% on the day.
In Treasuries, yields turned lower after earlier rising
sharply as investors eyed the resilient labor market and rising
wages as worrisome for the Fed's efforts to tame inflation.
Benchmark 10-year note yields were up 2.7 basis
points to 3.554%, from 3.527% late on Thursday. The 30-year bond
yield was last down 3.9 basis points at 3.594%, from
3.633%. The 2-year note yield was last was up 7.1
basis points at 4.3255% from 4.254%.
Oil futures sank in Friday's choppy session ahead of a
meeting of the Organization of the Petroleum Exporting Countries
and its allies (OPEC+) on Sunday and an EU ban on Russian crude
U.S. crude settled down 1.5% at $79.98 per barrel and
Brent ended at $85.57, also down 1.5% on the day.
Gold prices also regained some lost ground from their
earlier reaction to the jobs data.
Spot gold dropped 0.3% to $1,797.69 an ounce after
earlier falling as much as 1.4%.
(Reporting by Sinéad Carew, Karen Brettell, Gertrude
Chavez-Dreyfuss, Chuck Mikolajczak and Herbert Lash in New York,
and Ankika Biswas in Bengaluru; Editing by Marguerita Choy and