New Delhi, June 08, 2020.
US stock futures and Asian shares advanced on Monday after a surprise recovery in US employment gave further confidence of a quick economic recovery after many weeks of lockdowns aimed at controlling the coronavirus pandemic.
US S&P500 futures rose 0.5% to stand near their highest levels since late February while Japan’s Nikkei opened more than 1% higher.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.3% in early trade, with South Korea’s Kospi rising 1.4%. The Australian share market was closed for a holiday.
US nonfarm payrolls rose by 2.509 million jobs last month – in contrast with consensus estimates of a fall in 8 million jobs after a record plunge of 20.687 million in April.
The Labor Department’s closely watched employment report also showed the jobless rate falling to 13.3% last month from 14.7% in April, a post-World War Two high. Economists had forecast the rate jumping to 19.8%.
“Although there are some risk factors such as weekend demonstrations in the United States and concerns about the second wave of the coronavirus, hopes of economic reopening are taking the lead,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management.
US bond prices have tumbled, with the 10-year Treasuries yield rising to as high as 0.959% on Friday, a level last seen in mid-March.
The sharp gains in US bond yields over the last couple of days put more focus on the US central bank, which will hold a two-day policy meeting ending on Wednesday.
Fed Chair Jerome Powell has said the U.S. economy could feel the weight of the economic shutdown for more than a year.
Chinese trade data published on Sunday also showed the ongoing impact from the epidemic.
Exports contracted in May as global coronavirus lockdowns continued to devastate demand, while a sharper-than-expected fall in imports pointed to mounting pressure on manufacturers as global growth stalls.