Stocks rise with Amazon; US yields up as investors digest weak jobs data

NEW YORK : Global stock indexes climbed on Friday with Amazon.com shares rallying following the company’s stronger-than-expected results, while benchmark 10-year Treasury yields rose as investors digested a weak U.S. jobs report.
Amazon.com shares jumped 6.2 per cent after its report late on Thursday. It also indicated that it expected healthy results in the holiday quarter.
The share gain helped offset a 1.2 per cent decline in shares of Apple following the iPhone maker’s modest growth outlook.
“We’ve made it most of the way through the Big Tech names, and (results) were probably not as bad as people feared and, in some cases, were pretty good. So investors decided that the little bit of a sell-off we had the last couple of days was unwarranted,” said Rick Meckler, partner at Cherry Lane Investments, a family investment office in New Vernon, New Jersey.
Treasury yields initially tumbled after the jobs data, which showed the U.S. economy barely added any jobs in October, though the numbers were heavily disrupted by industrial action and hurricanes.
The U.S. unemployment rate, however, held steady at 4.1 per cent, offering assurance that the labor market remained on a solid footing.
Benchmark 10-year yields were last up 2.5 basis points at 4.309 per cent after earlier dropping to 4.222 per cent. They reached a nearly four-month high of 4.339 per cent on Tuesday.
Traders are now pricing in 99 per cent odds of a 25-basis-point cut at the Fed’s Nov. 6-7 meeting, up from 93 per cent before the data, and an 83 per cent probability of a 25-basis-point reduction at both its November and December meetings, up from 71 per cent earlier on Friday, according to the CME Group’s FedWatch Tool.
The focus will now turn to the U.S. presidential election, with polls pointing to a knife-edge race. Polls, both nationally and in the seven closely divided states, show Republican Donald Trump and Democratic Vice President Kamala Harris in almost a dead heat with four days to go before Election Day.
Based on the latest available data, the Dow Jones Industrial Average rose 288.34 points, or 0.69 per cent, to 42,051.80, the S&P 500 rose 23.46 points, or 0.41 per cent, to 5,728.91 and the Nasdaq Composite rose 144.77 points, or 0.80 per cent, to 18,239.92.
MSCI’s gauge of stocks across the globe rose 4.04 points, or 0.49 per cent, to 836.34. The STOXX 600 index rose 1.09 per cent.
The dollar pared gains against the euro after the U.S. jobs data.
The dollar index, which measures the greenback against a basket of currencies, was last up 0.39 per cent at 104.28, with the euro down 0.4 per cent at $1.0839. Against the Japanese yen, the dollar strengthened 0.64 per cent to 153.
The U.S. data also provided some relief for Britain’s under-fire government bonds, with the 10-year gilt yield building on an earlier fall, last down 6 bps at 4.39 per cent. [GB/]
British bonds are still set for a weekly rise driven by the new Labour government’s tax-and-spend budget igniting concerns over inflation and growth.
Oil extended its recent rally on reports that Iran was preparing a retaliatory strike on Israel from Iraqi territory in the coming days.
Iran and Israel have engaged in a series of strikes within the broader Middle East warfare set off by fighting in Gaza. Previous Iranian air attacks on Israel on Oct. 1 and in April were mostly repelled, with only minor damage.
Brent futures gained 29 cents to settle at $73.10 a barrel, while U.S. West Texas Intermediate (WTI) crude gained 23 cents to settle at $69.49.