Strong US non-farm payroll data spread an optimistic tone across the global equity markets verifying signs of improving employment conditions in the US economy. European equity markets surged as the CAC, DAX, IBEX and London equity benchmark index posted fresh gains between 0.9% and 2.4%. In the US, the Dow Jones index edged higher trading above 17,950, testing a new record high.
Following the latest US non-farm payroll report, the US economy added 321,000 jobs in November beating analysts’ expectations of a 230,000 rise, while unemployment rate remained flat at 5.8% during the same period. Following the robust employment data, the USD index rallied to hit a high at 89.45 against a basket of currencies, while the euro came under renewed pressure breaching support at 1.23.
The strong USD added some pressure to most commodity prices and weighed on market sentiment. Crude oil prices extended losses with WTI front month futures retreating sharply over 2% towards $65 per barrel. Brent front month futures plunged over 1.8% heading towards $68 per barrel while immediate support holds near December’s low at $67.53.
Base metal prices remained in negative territory, as the recent US dollar strength weighs heavily on sentiment. Aluminium fell below $1980 and copper slid lower within the recent range of $6400-$6450. Lead, nickel and tin extended losses ending a volatile week.
Precious metals posted fresh losses with spot gold breaching key support at $1200/ounce.