Market update: Markets bask in glow of US jobs boost – 08.07.2013

Source: Henderson Global Investors

Wall Street made gains on Friday (S&P 500, Dow Jones, Nasdaq each up 1.0%) while the US 10-year Treasury yield reached a high of 2.7% as investors were buoyed by the solid June jobs creation report. Non-farm payrolls came in at 195,000, topping analyst expectations for a 175,000 rise; there was no change to the unemployment rate of 7.6%. The brighter jobs report has lent support to the view that the US Federal Reserve will begin to wind down its bond purchasing programme later this year.

At the time of writing this morning the robust US jobs print has helped the US dollar to soar to a three-year high against major currencies and gold is close to hitting a three-year low. European shares are also on the rise (FTSE Eurofirst 300 +1.0%, FTSE 100 +0.9%). Greece’s government is edging closer on a deal with its international lenders, which will enable the release of its latest tranche of European aid. Over in Portugal political tensions appear to be easing; in an effort to save the government the Portuguese prime minister has announced a reshuffle in his cabinet. Last week the foreign minister resigned in protest as he did not agree with the appointment of a new pro-austerity finance minister.