11:55 AM New York – Market indexes in New York traded higher after May unemployment rate rose to 7.6% and U.S. employers added 175,000 net new jobs. The labor market data was one of the better economic reports in the last five weeks. Walmart announced $15 billion share repurchase program.
Stocks on Wall Street rebounded after the release of monthly jobs report that was dubbed as good but not exciting.
U.S. employers added net 175,000 jobs in May, matching the average monthly jobs increase in 2012, the Labor Department reported Friday.
Employers added revised 149,000 jobs in April, smaller than the previous estimate from the department.
In a separate survey conducted by the department showed unemployment rate increased to 7.6% and labor force size increased by 420,000.
Private sector added 178,000 jobs and employment at factories declined for the third month in a row and fell 8,000 after falling 9,000 in the previous month. Construction companies added 7,000 jobs and retailers expanded payrolls by 27,700.
On the other hand, federal government cut 14,000 jobs and Pentagon is scheduled to furlough 680,000 civilian workers from July. At the end of May, 11.8 million people are unemployed and looking for work, 4.4 million have been looking for work for more than six months.
Market indexes traded higher after the jobs report and indexes in Europe also gained.
On Wall Street, S&P 500 index increased 1% or 16.18 to 1,638.94 and the Nasdaq Composite Index gained 0.9% or 31.28 to 3,455.29.
European markets traded higher after the release of U.S. jobs report. Market sentiment has been cautious as investors increasingly factor the unwinding of stimulus from central bank in the U.S.
In Frankfurt, the DAX index increased 1.9% and in London the FTSE 100 index gained 1.3%. In Paris, CAC 40 index jumped 1.7% and in Zurich the SMI index soared 2%.
Stocks in Tokyo extended losses and the Nikkei declined to a two-month low. Government Pension Fund said it will increase its Japanese equities allocation by 1% to 12% and cut its bond holdings to 60% from 67%.
The Nikkei index closed at a 2-month low after reaching a 5-year high and plunged 6.5% in the week.
The Nikkei 225 Stock Average fell 26.49 to 12,877.53 and Topix index dropped 13.82 or 1.3% to 1,056.95.
The Nikkei index is still up 24% in the year so far and in dollar the index is up 10% on the yen weakness. The recent market declines have been associated with the rise in the yen as foreign investors unwind their hedges and sell Japanese stocks.
Market indexes in Singapore and Hong Kong declined more than 1% after the pension fund in Japan announced sharply lower than expected shift in stock allocation.
Market index in Seoul plunged 1.8%, the most in eleven months and Samsung Electronics plunged 7% after brokers estimated weaker than anticipated demand for the latest mobile phone.