Treasury yields and the dollar rose, while the S&P 500 eased yesterday after US job growth accelerated in August and the unemployment rate held steady.
The monthly report suggests the labour market remains stable and raised expectations that the US Federal Reserve will raise interest rates later this month, as investors look ahead to next week’s consumer inflation as key to that determination.
Nonfarm payrolls rose by 162,000 jobs last month after an upwardly revised rise of 21,000 in July. Economists polled by Reuters had forecast an increase of 56,000 after a previously reported drop of 23,000 in July.
The yield on benchmark US 10-year notes was last up 1.21 basis points at 4.774 per cent. It was at 4.792pc just after the report. Two-year yields hit their highest since January 2025.
“In the Fed’s eyes, the labor market is holding up, which means inflation remains the bigger problem,” said Bret Kenwell, US investment analyst at eToro in New York.
“Next week’s CPI report will be closely watched with the Fed’s interest-rate decision looming in mid-September.”
Short-term interest-rate futures now imply about a 65pc chance for a hike at the Fed’s September 15 to 16 meeting, up from about 55pc before the report.
Oil prices slipped from recent highs. Renewed attacks in the US-Iran war this week have sparked a jump in oil prices, adding to existing worries about higher costs.
US crude was down 1.6pc to $89.87 a barrel and Brent lost 1.3pc to $94.26 per barrel.
The Dow Jones Industrial Average fell 98.46 points, or 0.19pc, to 53,587.65, the S&P 500 fell 6.06 points, or 0.08pc, to 7,741.65 and the Nasdaq Composite rose 17.02 points, or 0.06pc, to 26,601.08.
MSCI’s gauge of stocks across the globe rose 1.02 points, or 0.09pc, to 1,155.76. The pan-European STOXX 600 index rose 0.04pc.
The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, was up 0.2pc on the day. The Japanese yen briefly weakened 0.41pc to 156.45 per dollar. The dollar was last near flat against the yen.
Spot gold fell 1.2pc to $4,418.09 an ounce.
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