Friday August 5th

5-08-2016

US futures extend gains after jobs report beat

U.S. stock index futures indicated a higher open on Friday as traders digested a better-than-expected jobs report. The U.S. economy added 255,000 jobs last month, while economists expected a gain of 180,000 jobs. The unemployment rate remained unchanged at 4.9 percent. Elsewhere on the data front, consumer credit is set to come out at 3 p.m. Thursday saw the Bank of England cut interest rates to 0.25 percent from 0.5 percent. In Europe, the pan European Stoxx 600 Index was up by around 0.18 percent. Asia markets closed mixed on Friday, as traders trimmed holdings ahead of the key July non-farm payroll report in the U.S., due later Friday. Major indexes in Australia and Japan posted weekly losses. In Australia, the ASX 200 index finished up 21.59 points, or 0.39 percent, at 5,497.40, with the energy and materials sub-indexes advancing 1.19 percent and 1.73 percent, respectively. For the week, the index posted a weekly loss of 1.17 percent. Japan's benchmark Nikkei 225 index closed flat at 16,254.45, failing to hold onto morning gains, and posting a weekly loss of 2 percent. Earlier this week, Japanese stocks sold off on the back of a stronger yen as investors appeared to have been disappointed with the stimulus measures announced by the government and the central bank in Japan. Across the Korean Strait, the Kospi closed up 17.91 points, or 0.9 percent, at 2,017.94. Hong Kong's Hang Seng index was up 1.42 percent. Chinese mainland markets closed slightly lower, with the Shanghai composite down 5.42 points, or 0.18 percent, at 2,977, and the Shenzhen composite was lower by 7.30 points, or 0.37 percent, to 1,941.60. Oil prices held their losses after the dollar spiked following a better-than-expected U.S. jobs report that showed the country added 255,000 positions in July. A stronger greenback makes dollar-denominated crude more expensive to holders of other currencies. Crude futures had dipped ahead of the report on Friday, ending a two-day rally, as a glut of crude and refined products weighed on markets and investors eyed a possible stutter in China's imports. U.S. West Texas Intermediate (WTI) crude crude futures fell 15 cents to $41.78 per barrel at 8:35 a.m. ET (1235 GMT). International Brent crude futures were trading down 14 cents at $44.15 per barrel. Gold held steady Friday after the headline figure on the July jobs report topped expectations. Spot gold has risen about 1 percent so far this week, boosted interest rate rise at its monthly policy meeting last week. Gold is highly sensitive to rising U.S. interest rates, as the opportunity cost of holding the non-yielding asset increases while boosting the dollar, in which it is priced. Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.37 percent to 973.21 tonnes on Thursday.