Monday September 6th

6-09-2021

European markets climb as central bank tightening fears cool

European stocks advanced on Monday after U.S. jobs data indicated the Federal Reserve may have to keep monetary policy loose for longer, while speculation has risen over more stimulus in Japan and China. The pan-European Stoxx 600 climbed 0.6% by early afternoon, with tech stocks adding 1.7% to lead gains while utilities slipped 0.2% lower. Stateside, the Dow Jones Industrial Average retreated on Friday and the S&P 500 slipped from a record high after the U.S. August jobs report came in short of expectations, showing the impact of the delta-fueled Covid resurgence. Nonfarm payrolls increased by 235,000 in August, the Labor Department said Friday. Economists surveyed by Dow Jones were expecting 720,000 jobs. The report marked a significant slowdown from July’s revised number of 1.053 million and comes as the delta variant of Covid-19 has led to health restrictions being put back in place in some states and cities. Federal Reserve Chairman Jerome Powell has emphasized the need for stronger jobs data before the central bank would start to unwind its massive bond-buying program, and the disappointing report could change expectations about when the Fed will start its tapering process. U.S. markets are closed on Monday for the Labor Day holiday. Asia-Pacific stocks rose on Monday, with shares in Japan and China seeing big gains. Japan’s Nikkei 225 was among the biggest gainers regionally, rising 1.83% to close at 29,659.89. That added to its surge of 2.05% on Friday after Japanese Prime Minister Yoshihide Suga said he will not be running in the upcoming leadership election. The Topix advanced 1.24%. Mainland Chinese stocks also saw robust gains on the day, with the Shanghai composite gaining 1.12% to 3,621.86 and the Shenzhen component jumped 2.586% to 14,546.60. Hong Kong’s Hang Seng index rose about 0.9%, as of its final hour of trading. Elsewhere, South Korea’s Kospi ended the trading day fractionally higher at 3,203.33. Oil prices rose on Friday as a rebound in global demand was widely expected and a slow recovery for the U.S. Gulf Coast export and refining hub from the hurricane earlier this week looked set to deplete stocks further. Brent crude futures were up 39 cents, or 0.5%, to $73.42 a barrel at 1231 GMT, while U.S. West Texas Intermediate (WTI) crude futures were up 21 cents or 0.3% at $70.20 a barrel. Both benchmark oil contracts were largely steady for the week. Gold prices hovered on Monday below a 2-1/2-month peak after a disappointing U.S. jobs data signaled that the Federal Reserve could push back the timeline for tapering stimulus measures, bolstering bullion’s appeal as an inflation hedge. Spot gold was steady at $1,826.65 per ounce, as of 0048 GMT. In the previous session, prices hit a peak since June 16 at $1,833.80. U.S. gold futures eased 0.3% to $1,828.60.