GLOBAL MARKETS-Stocks gain on U.S. jobs data, dollar weakens

Fri Apr 4, 2014 11:17am EDT

* Wall St touches fresh record high after U.S. payrolls
    * Dollar slips as U.S. jobs data suggests less stimulus
    * Brent rises from 5-month low to above $106
    * Bond yields dip after data, fears ease of early rate hike

 (Adds opening of U.S. markets, byline, dateline; previous
LONDON)
    By Herbert Lash
    NEW YORK, April 4 (Reuters) - Steady U.S. jobs growth pushed
stocks on Wall Street to fresh highs and kept European equities
on track for a ninth day of gains Friday, while damping the
dollar's strength on the outlook that the Federal Reserve will
continue to wind down stimulus.
    The U.S. labor market emerged surprisingly strong from a
severe winter, with employers hiring at a brisk pace and the
jobless rate holding near a five-year low. 
    Nonfarm payrolls rose by 192,000 jobs in March after rising
by 197,000 a month earlier, the Labor Department said. The
unemployment rate was unchanged at 6.7 percent even though
Americans flooded the labor market to hunt for work.
    A smaller survey of households, from which the unemployment
rate is derived, showed a much bigger surge in employment. That
jump was met by a rise in the number of people entering the
labor force, a show of confidence in the U.S. job market.
    The percentage of working-age Americans with a job reached
its highest level since the summer of 2009.
    U.S. stocks advanced slightly, paring some initial gains
after the S&P 500 hit its latest record high, and the Nasdaq
stock market retreated.
    The solid payroll report buoyed investor sentiment.
    "It looks like the party goes on," said Rick Meckler,
president of hedge fund Libertyview Capital Management in Jersey
City, New Jersey. 
    The Dow Jones industrial average rose 32.5 points, or
0.2 percent, to 16,605.05. The S&P 500 gained 3.97
points, or 0.21 percent, to 1,892.74 and the Nasdaq Composite
 dropped 16.291 points, or 0.38 percent, to 4,221.449.
    The bond market surprisingly rallied, particularly five-year
notes which have been weak of late on fears the Federal Reserve
could raise interest rates earlier than anticipated. Because the
jobs data did not exceed expectations, and wage growth was still
weak, the bond market has recovered from some recent losses. 
    "This number doesn't give any reason to move up the Fed
timing of rate hikes, which is what was feared most," said John
Briggs, U.S. rates strategist at RBS in Stamford, Connecticut.
    The FTSEurofirst 300 index of top European shares
rose 0.6 percent to 1,353.10 points. The index touched a high
last seen in 2008, putting it on track to record nine straight
gains and three consecutive weeks of higher closes.
    The dollar backed away from early gains and declined against
other major currencies despite the solid U.S. jobs gains.
    The jobs report will likely encourage the Fed to continue
reducing, or tapering, its massive monetary stimulus, according
to Anthony Valeri, investment strategist at LPL Financial in San
Diego.
     "It's a Goldilocks report, not too warm and not too cold,
and puts pressure on the next report in May to be good," Valeri
said. "It doesn't change the pace of tapering and shows the
economy is still on track." 
    The greenback was down 0.28 percent against the euro 
at $1.3679 and 0.21 percent lower against the Japanese yen at
103.69 yen after hitting a session high of 104.12 yen in trading
immediately after the employment reports
    The benchmark 10-year U.S. Treasury note rose
9/32 in price to yield 2.7285 percent.
    Brent crude rose above $106 a barrel as expectations of a
deal to reopen vital Libyan oil ports were balanced by doubts
that a lasting resolution was imminent. 
    Brent crude was up 67 cents at $106.82 a barrel.
U.S. crude, or West Texas Intermediate (WTI), rose $1.16
to $100.45 a barrel.

 (Additional reporting by Marc Jones in London, reporting by
Herbert Lash; Editing by Bernadette Baum)