(Bloomberg) -- Treasuries rallied and Standard & Poor’s 500 Index futures rose after U.S. payrolls climbed less than forecast in December, easing concerns that stimulus cuts would accelerate. Commodities rebounded from an eight-month low as China’s imports grew.
The 10-year Treasury yield fell six basis points to 2.90 percent at 9:04 a.m. in New York. S&P 500 futures rose 0.3 percent after sliding as much as 0.2 percent. The Stoxx Europe 600 Index added 0.7 percent. The Bloomberg Dollar Spot Index, which tracks the U.S. currency against 10 of its major peers, lost 0.2 percent. The S&P GSCI Index of 24 commodities rose 0.9 percent as oil jumped 1.5 percent and copper rallied from a three-week low. Gold rose 0.9 percent to $1,240.40 an ounce.
U.S. employers hired 74,000 workers in December, Labor Department figures showed. That trailed the 197,000 forecast in a Bloomberg survey of economists. The unemployment rate fell to 6.7 percent. China’s imports rose the most in five months in December, and industrial production in France and Spain beat estimates, other data showed today.
“The jobs number is a proxy for what the Fed will or won’t do in the coming months and any strong pivot one way or another will have implications on the risk market, credit or equities,” Chad Morganlander, a Florham Park, New Jersey-based fund manager at Stifel Nicolaus & Co., which oversees about $150 billion of assets, said in a phone interview.
Cutting Purchases
The Fed said last month it will cut monthly asset purchases to $75 billion from $85 billion. Policy makers will trim stimulus in $10 billion increments over the next seven meetings before ending them in December, according to a Bloomberg survey of economists on Dec. 19.
At the central bank’s December meeting, some members of the Federal Open Market Committee “expressed the view that the criterion of substantial improvement in the outlook for the labor market was likely to be met in the coming year if the economy evolved as expected,” meeting minutes showed Jan. 8.
“This could actually be good news for the market,” Quincy Krosby, a market strategist for Newark, New Jersey-based Prudential Financial Inc., which oversees more than $1 trillion, said by phone. “If these numbers don’t get revised upward, it will keep the Fed careful about wanting to taper too quickly.”
Swatch Group AG added 4.7 percent after disclosing a positive outlook for 2014. Deutsche Lufthansa AG jumped 8.1 percent for the biggest increase in the Stoxx 600 after Europe’s second-largest airline said fuel and unit costs will decline this year as the carrier uses bigger, more modern planes.
Metro AG gained 4.7 percent after a report said its biggest shareholder, Franz Haniel & Cie, may push for replacing its chief executive officer and selling some units. Haniel spokesman said the report was “nonsense.”
Alcoa Inc., the largest U.S. aluminum producer, slid 7 percent in pre-market trading. The company reported fourth- quarter profit that missed analysts’ estimates after the close of normal trading yesterday.
Emerging Markets
The MSCI Emerging Markets Index added 0.3 percent, trimming this week’s decline to 1.4 percent. A gauge of mainland shares in Hong Kong fluctuated, while the Shanghai Composite Index decreased 0.7 percent after China’s trade data showed inbound shipments increased 8.3 percent from a year earlier. That compares with the median estimate for 5 percent growth in a Bloomberg News survey. China’s exports rose 4.3 percent with the trade surplus at $25.6 billion, narrower than projected.
India’s S&P BSE Sensex added 0.2 percent. Infosys Ltd., the nation’s second-largest software exporter, jumped 2.9 percent after raising its sales forecast. The rupee strengthened 0.2 percent, erasing this week’s decline.
Thailand’s SET Index dropped 0.2 percent. Anti-government protesters plan to surround government offices and occupy major intersections in Bangkok starting Jan. 13 to obstruct Feb. 2 elections and force caretaker Prime Minister Yingluck Shinawatra to step down.
Debt Sales
Corporate credit markets are poised for their busiest week for new issuance since March 2011. Petroleo Brasileiro SA led more than $54 billion of corporate bond sales in euros and pounds this week as measures of credit risk fell to the lowest since January 2010. The Markit iTraxx Europe Index of credit- default swaps on 125 investment grade companies was little changed today at 71.5 basis points.
