US nonfarm payrolls came in well above expectations (254K vs street 140K) sparking a surge in US index futures trading. The three main contracts are now up 0.3% to 0.8% with Nasdaq futures leading the way higher. Index futures had already been trending upward overnight on the news that US port workers agreed to call off their strike for now and go back to work.
Treasury yields are also jumping on this news with the 10-year climbing back up above 3.95% for the first time since August. Average hourly earnings came in higher than expected (4.0% vs street 3.8%) indicating that wage inflation pressures have not gone away. Combined this morning’s news weakens the case for large interest rate cuts, confirming comments from Fed Chair Powell earlier this week. The US Dollar is rallying on the news, gaining 0.9% against the Yen, 0.8% against Gold, and 0.5% against the Euro. Interestingly, Cryptocurrencies are up with Bitcoin gaining 1.1%, echoing the “risk-on” sentiment we have been seeing in stocks.
Commodities are also picking up today partly in tandem with US gains and also continuing to get support from China-related trading as the Hang Seng gained another 2.8% overnight. So far today, US Crude Oil is up 0.8% and Copper is up 0.1%.