Dollar weakens, stocks gain on US data

NEW YORK: The dollar weakened while stocks and bond prices jumped after a report showed US
jobs growth was less than expected in August, adding to uncertainty over when the Federal Reserve will begin to trim its massive bond-buying program.
Gold prices also gained after the payrolls data.
Wall Street stocks briefly retreated in tandem with European shares after Russian President Vladimir Putin pledged to assist Syria. However, Putin made clear that Russia did not want to be sucked into a war over Syria.
The jobs report added to signs that economic growth may have slowed a bit in the third quarter. It showed nonfarm payrolls increased by 169,000 jobs last month, below the 180,000 Wall Street expected, and that the jobless rate hit a 4-1/2-year low as many Americans gave up the search for work.
“Today’s data, in combination with Syrian uncertainties, are likely to keep the US Fed on the sidelines for now,” saidDouglas Borthwick, managing director at Chapdelaine Foreign Exchange in New York.
The Fed has said it would begin to reduce its $85 billion a month in bond purchases depending on progress in the labor market. Policymakers were widely expected to make an announcement on the bond program when they meet Sept. 17-18.
The dollar fell from a seven-week high against the euro.
The euro was last up 0.1 percent at $1.3130 and the dollar was down 0.9 percent against the yen at 99.20 yen.
On Wall Street, the Dow Jones industrial average was up 33.33 points, or 0.22 percent, at 14,970.81. The Standard & Poor’s 500 Index was up 5.31 points, or 0.32 percent, at 1,660.39. The Nasdaq Composite Index was up 8.45 points, or 0.23 percent, at 3,667.23.
MSCI’s world share index, which tracks 45 countries, was up 0.6 percent, while the FTSEurofirst 300
was up 0.4 percent after briefly trading lower.
The US bond market rallied, with benchmark yields falling back below 3 percent as the jobs report left traders to question whether the Fed might pare its bond purchases soon.
Benchmark 10-year Treasury notes last traded up 24/32 in price, after surging over 1 point moments after the
payrolls data. Their yield fell to as low as 2.864 percent before retracing back to 2.904 percent.
The 10-year yield had touched 3.007 percent overnight, a level not seen since July 2011.
Gold, which has benefited from ultra-cheap central bank liquidity, climbed after the data. Gold was up 1.5
percent at $1,386.74 an ounce.