Global equity markets edged higher and Treasury yields rose on Friday after a weak U.S. labor market report likely kept the Federal Reserve on track to begin tapering its massive bond purchases in November.
Yields on the benchmark 10-year U.S. Treasury note climbed above 1.6% for the first time since June, the dollar eased and stocks on Wall Street moved sideways with an upward bent.
The U.S. economy created the fewest jobs in nine months in September amid a drop in hiring at schools and worker shortages, a decline some attributed to mask requirements imposed during the surge of the Delta variant in the summer.
“The headline weakness hides an otherwise much stronger job market than we’re currently seeing,” said Russell Price, chief economist at Ameriprise Financial Services Inc in Troy, Michigan. “It’s related to mandates for vaccinations for the people who may have lost their jobs because of that.”
MSCI’s all-country world index rose 0.14% while the broad STOXX Europe 600 index closed down 0.28%. But European stocks still marked their best week in two months as fears of soaring inflation were tempered.
Gains in oil and auto stocks were outweighed by a 1.4% decline in tech stocks as rising bond yields dimmed the high-growth sector’s appeal, a story that also played out on Wall Street.
