Automated Translation by Reuters using machine learning and AI, please refer to the warning: https://bit.ly/rtrsauto
The U.S. job growth exceeds expectations, S&P gains 0.8% Brent hovers around $100 per barrel due to renewed hostilities in the Middle East U.S. consumer confidence plummets (Midday update on U.S. markets) by Lawrence Delevingne and Samuel Indyk
Global stock markets reported mixed results on Friday as new data from the U.S. highlighted job growth, despite consumer confidence dropping and oil prices remaining high due to ongoing combat near the Strait of Hormuz. European stocks declined, but the S&P 500 rose by 0.8%, and the Nasdaq Composite surged by 1.4%. The Dow Jones Industrial Average remained virtually unchanged. Chip manufacturers rebounded, with Qualcomm rising about 10% and Nvidia increasing by 2.3%.
Oil prices rose again on Friday after renewed combat near the Strait of Hormuz raised concerns about the ceasefire between the U.S. and Iran. Brent futures were up around 1.3% to about $101 per barrel. U.S. employment increased more than expected in April, while the unemployment rate remained stable at 4.3%, reflecting labor market resilience and reinforcing expectations that the Federal Reserve would keep interest rates unchanged for some time.
“Strong employment data keep the Fed in its current position of observation and waiting, focusing on the inflation aspect of its mandate,” said Ellen Zentner, chief economic strategist at Morgan Stanley Wealth Management. “Rate cuts are still not on the short-term agenda, but the lack of inflation threats in today’s report should ease some rumors about a potential hike.”
Meanwhile, U.S. consumer confidence hit historically low levels in early May, with gasoline price increases weighing on household finances and purchasing power, according to a survey released on Friday.
MIDDLE EAST CONFLICTS
The U.S. and Iran exchanged fire in the Gulf, and the United Arab Emirates faced new attacks, testing a ceasefire in place for a month. Both sides downplayed the situation, leaving investors uncertain.
“The market seems eager to anticipate a quick end to the war,” said Jan von Gerich, chief analyst at Nordea. “But it is unlikely that an agreement will be reached. I continue to believe that disruptions in the Strait of Hormuz will persist, and the situation will not be resolved soon.”
European stocks declined, with the STOXX 600 index losing 0.77%.
Asian stocks retreated from recent highs but were still on track for a strong week, supported by revenue forecasts and high spending of U.S. AI giants, boosting chipmakers in the region.
The broadest MSCI index of Asian stocks outside Japan fell by 0.8%, although the South Korean KOSPI slightly increased by 0.1%, leading to a weekly gain of over 13.5% — its most significant since 2008 — fueled by the rise of Samsung and SK Hynix.
Taiwan’s benchmark index rose by 7% this week, and Japan’s Nikkei gained 5.4%.
DOLLAR SLIGHTLY DROPS
The dollar slightly declined and was on track for a second consecutive weekly drop, while the yen remained in focus after Japan intervened in the foreign exchange markets early May to halt its decline, according to a source close to the matter. The dollar dipped by 0.17% to 156.64 yen and was set for a second weekly drop against the Japanese currency. Maintaining gains above 155 yen became challenging after a presumed intervention totaling nearly $70 billion since last Thursday.
