TOKYO (AP) – Global shares rose Friday as investors awaited a U.S.jobs report later in the day and action from the U.S. Federal Reserve later in the month.
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All 105 economists polled by Reuters had expected a higher number.
Bank shares fell sharply, with Citigroup dropping 3.4 percent and Bank of America 3.5 percent, as the prospects for lower rates longer is expected to hit lending margins. The yield on the 10-year Treasury note fell to 1.70 percent from 1.80 late Thursday, a large move.
Financials are biggest decliners by far of the 10 Standard & Poor’s sectors, with the biggest banks leading the way down. “I think this puts into serious question if the Fed is going to do anything for the year (in terms of rate hikes)”.
Canada’s main stock index gained marginally on Friday as a sharp gain for miners offset losses for financial, technology, healthcare and consumer discretionary stocks.
GOLD RUSH: Mining companies were among the biggest gainers as the price of gold and other precious metals rose.
Cliffs Natural Resources surged 36.8% to $4.20 after JP Morgan upgraded the stock and the iron ore producer signed a supply agreement with ArcelorMittal.
Based on current Fed forecasts, such an approach would keep US monetary policy on hold until 2018.
Among main laggards was Manulife Financial Corp, which declined 3 per cent to $18.83.
“June is too early, but September is too late”, Joy said.
It now only needs to rise about 1 per cent to set a closing record. Germany’s DAX fell 1 per cent, while France’s CAC 40 lost 1 per cent. Britain’s FTSE 100 rose 0.4 per cent.
Fed speakers: Speaking in London Friday, Chicago Federal Reserve President Charles Evans said (http://www.marketwatch.com/story/feds-charles-evans-says-more-aggressive-tightening-holds-risk-for-economy-2016-06-03) there is a “reasonable case” for holding off increasing the federal-funds rate until core inflation gets above 2% on a sustainable basis.
The Dow Jones industrial average fell 32 points, or 0.2 percent, to 17,805 as of 3:08 p.m. Eastern time. The S&P 500 closed down 6.13 points, or 0.29 per cent, at 2,099.13. The Nasdaq Composite was off 44.52 points, or 0.9 per cent, at 4,926.85.
European shares turned negative, with both the pan-European FTSEurofirst 300 and the STOXX Europe 600 indexes trading 0.6 percent lower.
“The numbers are not bad; they’re just not good either”, Bruce McCain, chief investment strategist at Key Private Bank in Cleveland, said about recent economic data.
There’s plenty more to come this week, including auto sales, the manufacturing PMI and the jobs report.
Oil prices climbed to a seven-month high near $50 a barrel, as US daily crude production slipped to the lowest level since 2014.
ENERGY: Benchmark U.S. crude oil was down 47 cents, or 1 per cent, to $48.78 a barrel in NY.
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The disappointing job gains undercut optimism that bolstered the S&P 500’s third-straight monthly increase in May amid speculation the world’s biggest economy could withstand a rate increase as soon as this month.
