Why the Jobs Report Triggered Fresh Anxiety in the Markets

The S&P 500 and Dow averages capped their biggest weekly declines since 2016, with the Dow sinking 665 points today, spooked by the accelerating rise in bond yields. Meanwhile wages rose at the fastest pace in more than eight years, suggesting employers are competing more fiercely for workers. The yield on 10-year Treasury notes, the benchmark for interest rates, has risen swiftly, stoking investor concerns that higher rates could weigh on company earnings and equity prices.

Nonfarm payrolls rose by 200,000 jobs in January, the Labor Department said, beating expectation of 180,000.

That improvement has also led central banks to temper their crisis-era stimulus measures, which has led to a rise in bond yields, including the key US Treasury market.

USA hiring picked up in January and wages rose at the fastest annual pace since the recession ended, as the economy's steady move toward full employment extended into 2018.

The S&P 500 was down 40 points, or 1.4 percent, at 2,782 and the Nasdaq Composite was down 88 points, or 1.2 percent, at 7,297.

USA gold futures GCv1 for April delivery settled down $10.60, or 0.8 percent, at $1,337.30.

At 9.37am ET (1437 GMT), the Dow Jones Industrial Average was down 91.9 points, or 0.35 per cent, at 26,057.49, the S&P 500 was down 2.26 points, or 0.08 per cent, at 2,821.55. The two rivals are often seen as an indicator of USA economic activity and consumer spending.

Gold fell 1 per cent on Friday in the wake of stronger than expected USA non-farm payrolls data which shored up expectations that the Federal Reserve will press ahead with interest rate hikes this year.


"There are concerns that rates are moving up and inflation is firming", said Jeff Zipper, managing director for investments at Private Client Reserve at U.S. Bank.

But here's a caution to investors: The oil price is a wild card in global equity markets, so if you own stocks, make sure to own some that reflect the oil price.

X FACTOR: Apple declined 2.6 percent after the technology company said it sold 77.3 million iPhones in the last quarter, below the 80 million analysts expected.

Alphabet fell 5.0 per cent after the Google parent's fourth-quarter profit came in below consensus on increased spending.

Oil majors Exxon (XOM.N) and Chevron (CVX.N) fell 5.1 percent and 5.6 percent, respectively, after reporting lower-than-expected quarterly profits.

The stock helped the consumer discretionary index rise 0.72 percent, the only gainer among the 11 major sectors.

Elsewhere, oil edged lower, though still trading near its highest level since 2015 in NY. Bitcoin futures on the Cboe Futures Exchange slid 5.7 percent to $8,560. But with a loss about 1,000 points since Monday, it was the blue chip index's worst weekly performance in 2 years.

The Stoxx Europe 600 Index decreased 1.4 percent, wiping out gains this year with its fifth consecutive decline. The Japanese yen JPY= weakened 0.64 percent versus the greenback at 110.12 per dollar. Hong Kong's Hang Seng index dipped 0.1 percent.

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