Stock indexes gained and the dollar was higher yesterday after data showed the US economy created fewer jobs than expected in December, supporting the view the Federal Reserve would leave interest rates unchanged this month.
The Bureau of Labour Statistics monthly report showed 50,000 workers were added to nonfarm payrolls in December, compared with expectations in a Reuters poll for a rise of 60,000, just above November’s downwardly revised increase of 56,000. The unemployment rate eased, as expected, to 4.4 per cent.
Fed funds futures traders are now pricing in only a 4.8pc chance of a rate cut at the Fed’s January 27-28 meeting, down from 11.6pc before the data. The next cut appears unlikely before at least April.
“Payrolls were a little bit light relative to consensus, but still fairly strong numbers,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York.
“We are back to normal in terms of economic reporting so that’s a bit of a relief for everyone.”
The release of US economic data had been delayed because of the long federal government shutdown.
The S&P 500 hit a record intraday high.
The Dow Jones Industrial Average rose 213.52 points, or 0.43pc, to 49,480.41, the S&P 500 rose 35.68 points, or 0.52pc, to 6,957.36 and the Nasdaq Composite rose 161.99 points, or 0.69pc, to 23,640.92. All three indexes are set for weekly gains in the first full trading week of 2026, with the Dow on track for its biggest weekly gain since the last week of November. MSCI’s gauge of stocks across the globe gained 4.55 points, or 0.44pc, to 1,034.00. The pan-European STOXX 600 index rose 0.96pc.
After the jobs report the dollar initially gave up almost all the day’s gains versus a basket of major currencies, having risen by nearly 0.2pc earlier. The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, was last up 0.28pc to 99.16.
US Treasury yields were down slightly after initially rising on the data. The yield on benchmark US 10-year notes fell 1.2 basis points to 4.171pc, from 4.183pc late on Thursday.
Investors had been bracing for a possible US Supreme Court ruling on the legality of President Donald Trump’s tariffs. But the court is expected to issue its next rulings on January 14. The court indicated on its website yesterday that it could release decisions in argued cases when the justices take the bench during a scheduled sitting next Wednesday.
In commodities, crude oil was sharply higher. US crude rose 2.87pc to $59.42 a barrel and Brent rose to $63.53 per barrel, up 2.48pc on the day.
Investors have become more convinced that production in Venezuela, even under US control, may not rise meaningfully for some time.
Meanwhile, stock markets in the UAE declined yesterday, as investors remained reluctant to place bets ahead of the US jobs report.
Dubai’s main market closed 0.4pc lower, snapping a week-long rally, on broadly negative sentiment. Burj Khalifa Developer Emaar Properties slipped 1.7pc, while tollgate operator Salik Company shed 1.1pc.
Abu Dhabi’s benchmark index dropped 0.3pc, extending losses from the previous session, with Adnoc Gas and Adnoc Drilling falling 1.4pc and 1.9pc, respectively. Separately, the Abu Dhabi National Oil Company has set the February official selling price of its benchmark Murban crude at $63.06 a barrel, it said yesterday, down from January’s OSP of $65.53 a barrel.
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