Strong US jobs report sends markets higher

Stocks gain after strong US jobs report, signs major central banks will keep easy money policy

Associated Press
Markets hit by concerns over Fed policy
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Tokyo Stock Exchange employees work at the computer terminal in Tokyo, Friday, July 5, 2013. Optimism that easy European and U.S. monetary policy will continue boosted Asian stock markets Friday as investors awaited a key American jobs report later in the day. Tokyo's Nikkei 225 was up 1.8 percent to 14,272.45. (AP Photo/Itsuo Inouye)(AP Photo/Itsuo Inouye)

LONDON (AP) -- A strong rise in U.S. jobs figures boosted world markets on Friday, as investors found it promised better growth but was unlikely to push the Federal Reserve to rein in its monetary stimulus program ahead of schedule.

A U.S. government report showed employers added 195,000 jobs in June and hiring was more robust in the two previous months than earlier estimated. The unemployment rate, however, remained at a relatively high 7.6 percent.

The figures are strong enough to raise hopes for better growth in the world's largest economy in the second half of the year, but not so much as to push the Federal Reserve to speed up its plan to rein in its monetary stimulus program. The program has been behind market gains in recent years and investors are fretting over what will happen as it is wound down, as the Fed has signaled it would start doing later this year if the U.S. economy continues to improve.

The unemployment rate is still uncomfortably high, meaning the Fed is likely to remain cautious about committing to withdraw its stimulus too quickly.

By mid-afternoon in Europe, Britain's FTSE 100 was up 0.7 percent to 6,464.58, adding to a 3 percent gain the day before. Germany's DAX trimmed losses to trade 0.4 percent lower, at 7,961.62. France's CAC-40 rose 0.1 percent to 3,811.11.

Futures augured gains on Wall Street after the Independence Day holiday. Dow futures climbed 1.2 percent to 15,092, with S&P 500 futures advancing by the same percentage to 1,628.90.

Markets have been buoyant since Thursday, when the European Central Bank and the Bank of England both said their interest rates would remain low for the foreseeable future. That eliminated concerns that they might follow the Fed in tightening their easy money policies this year, triggering a market rally.

In Asia, Tokyo's Nikkei 225 closed up 2.1 percent to 14,309.97 and Hong Kong's Hang Seng added 1.9 percent to 20,854.67 as investors there caught up with the rally in Europe the previous day.

Taipei's TAIEX jumped 1.4 percent to 8,001.82 while Sydney's S&P/ASX 200 edged up 1 percent to 4,841.70 and China's Shanghai Composite posted a small gain of 0.1 percent to 2,007.29.

Seoul's KOSPI fell 0.3 percent to 1,833.31 after shares of Samsung Electronic dropped nearly 4 percent after its quarterly operating profit failed to meet market expectations. The company estimated April-June earnings at a record high 9.5 trillion won ($8.3 billion) but that was below analysts' forecasts and investors are worried profit growth could slow as smartphone sales in rich nations reach a saturation point.

Benchmark crude for August delivery was up 69 cents at $101.93 a barrel in electronic trading on the New York Mercantile Exchange.

In currencies, the euro fell to $1.2823 from $1.2902. The dollar rose to 101.07 yen from 100.23 yen late Thursday.

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Kay Johnson in Bangkok contributed to this report.

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