A roundup of trading on major world markets:
NEW YORK – Wall Street stocks on Friday closed in the red after a credit downgrade on Italy and Spain snuffed out a rally on better-than-expected US jobs numbers.
The Dow Jones Industrial Average shed 20.21 points (0.18 per cent) on Friday to finish at 11,103.12.
The broader S&P 500 fell 9.51 points (0.82 per cent) to 1,155.46, while the tech-heavy Nasdaq Composite lost 27.47 points (1.10 per cent) to 2,479.35.
Stocks had posted moderate gains in early trade, buoyed by the jobs report that showed the economy created a net nonfarm 103,000 jobs in September, more than analysts anticipated, but not enough to lower the unemployment rate stuck at 9.1 per cent for three months.
The department revised upward the two previous months’ job creation numbers, indicating that employment in the faltering economy had more momentum than previously believed.
The July payrolls totalled 127,000, not the 85,000 initially estimated, while August was revised from zero to 57,000.
The bond market fell. The 10-year Treasury bond yield increased to 2.07 per cent from 1.99 per cent late Thursday, while the 30-year yield rose to 3.02 per cent from 2.95 per cent.
Bond prices and yields move in opposite directions.
LONDON – European stocks closed firmer on Friday after a week of very sharp gains and the euro strengthened on positive jobs data from the US and growing signs that a coordinated rescue for eurozone banks is in the works.
A day after the European Central Bank and the Bank of England took fresh steps to boost credit, higher-than-expected US jobs data helped ease concerns that the world’s biggest economy was at risk of slipping back into recession.
On the negative side, Moody’s downgraded its credit ratings for a dozen British banks, highlighting worries over the banking sector and the need for European governments to help.
And moments after the close, Fitch’s ratings agency slapped Spain and Italy with ratings downgrades in a stark reminder that the sovereign debt crisis will not go away without some firm action soon.
At the close, London’s FTSE-100 index of leading shares was up 0.23 per cent at 5303.40 points. In Frankfurt, the DAX gained 0.54 per cent to 5675.70 points and in Paris the CAC-40 added 0.66 per cent to 3095.56 points.
Elsewhere in Europe, Milan gained 1.29 per cent, Madrid 1.08 per cent, Lisbon 1.07 per cent and Amsterdam 0.87 per cent.
The euro topped $US1.35 for the first time this week, rising to $US1.3503 from $US1.3433 in New York late on Thursday. The dollar edged up to 76.74 yen from 76.69 yen.
Moody’s downgraded British banks due to the removal and curtailment of government financial support. Affected banks slumped, with Royal Bank of Scotland down 4.8 per cent.
Moody’s said it believed Britain’s government was now more likely to allow smaller banks to fail if necessary.
Dexia, the teetering Franco-Belgian bank set to be split up and part-nationalised, was downgraded one notch by Standard & Poor’s a day after its shares were suspended from trading.
HONG KONG – Asian markets extended the previous day’s gains as dealers were cheered by European Central Bank plans to protect the region’s lenders from the sovereign debt crisis.
Tokyo closed 0.98 per cent higher, adding 83.60 points, to 8,605.62, Sydney ended 2.29 per cent, or 93 points, to 4,162.9 and Seoul surged 2.89 per cent, or 49.45 points, to 4,009.26.
Hong Kong ended 3.11 per cent, or 534.73 points, higher at 17,707.01.
Shanghai was closed for a public holiday.
Investors regained some of their confidence after the ECB held interest rates and announced measures to bolster under pressure eurozone banks.
Also Thursday Britain’s central bank, the Bank of England, said it would inject 75 billion pounds into the stalled economy to stimulate growth.
Global markets have been sent spinning in recent weeks as European leaders seem unable to agree how to help Greece avoid a default or how to protect lenders with exposure to Athens.
The US dollar unit edged slightly higher in early European trade. It bought $1.3438, against $1.3433 in New York late Thursday. The European common currency was at 103.04 yen compared with 103.03 yen.
The dollar was at 76.65 yen, from 76.69 yen.
With the ECB’s bank plan easing eurozone tension, dealers turned to the United States, where the government is due later Friday to release key jobs data that will give an indication to the health of the economy there.
WELLINGTON -Wellington ended 1.12 per cent, or 37.25 points, higher at 3,383.46.
