Asia-Pacific stocks started the week on a high note on Monday, following a rally in U.S. stocks boosted by encouraging labor market data last week. By 10:20 AM AEST (12:20 AM GMT), the Dow Jones Industrial Average was up 1.2% on the day. S&P/ASX 200, KOSPI 200 and Nikkei 225 added 0.2%, 0.3% and 1.2% respectively.
The major indexes posted solid gains, ending a tumultuous week on a positive note after the monthly jobs report energized the stock market's faltering rally. The S&P 500 rose 1.11 points, the NASDAQ Composite added 1.21 points, and the Dow Jones Industrial Average added 307 points, or 0.81 points. The uptrend was broad, with all 11 sectors of the S&P 500 closing higher for the week.
Investors and market analysts are scrutinizing economic data for signs that the job market is stronger than it appears. The latest monthly report showed that job gains exceeded economists' expectations, the unemployment rate remained low, and average hourly earnings rose at the slowest pace since June 2021. That has kept hopes alive of a June interest rate cut. Some investors say the dream scenario of an economy that is neither overheating nor underperforming remains intact. That optimism, combined with expectations that the U.S. economy will stave off a recession, has sent stock indexes to record highs this year.
However, the stock market rally lost some momentum last week as investors worried about rising commodity prices, geopolitical tensions and the Federal Reserve's plans to cut interest rates. Despite Friday's gains, the S&P 500 still posted a weekly loss of 11.3 percent, its biggest weekly loss since early January. The Dow Jones Industrial Average fell 2.3 percent and the Nasdaq lost 0.8 percent. In commodities, Brent crude rose 0.6 percent to $91.17 a barrel, while gold rose 1.7 percent to $2,329.75. Investors are closely watching oil prices, as rising prices could weigh on U.S. consumers, who have so far continued to spend despite higher interest rates.
Meanwhile, Chinese markets were closed for the Qingming Festival, but Hong Kong stocks ended the day flat, weighed down by uncertainty over U.S. interest rates and geopolitical tensions in the Middle East. Japanese stocks ended lower, weighed down by declines in brokerage and chip-related shares.
European stocks fell after U.S. nonfarm payrolls rose more than expected in March, raising doubts about the prospects for a near-term U.S. interest rate cut. The Stoxx Europe 600 closed down 0.8% at 506.55, its lowest close in two weeks, even as U.S. stocks rose. Germany's DAX fell 1.2%, France's CAC40 fell 1.1%, while Britain's FTSE 100 fell 0.8%.
Source: Investing
