Asia Morning: US Jobs Surge Boosts Market Optimism

On Friday, U.S. stocks jumped on an unexpected surge in May jobs…

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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