* Dollar gains after U.S. payrolls rise by 175,000 in May
* Data not seen as strong enough to prompt Fed pullback
* Global equity markets rise on 'Goldilocks' data
By Herbert Lash
NEW YORK, June 7 The dollar rose and global
equity markets advanced on Friday after U.S. jobs data for May
suggested the economy is improving but not enough to persuade
the Federal Reserve to start easing back on its monetary
stimulus, a good scenario for investors.
Employment outside the farming sector in the world's leading
economy rose by 175,000 last month, just above the median
forecast in a Reuters poll, Labor Department data showed.
The unemployment rate ticked one-tenth of a percentage point
higher to 7.6 percent, a relatively hopeful sign as it was
driven by more workers entering the American labor force.
Stocks on Wall Street rose about 1 percent, following gains
in Europe on the news, while the dollar rose against the euro
and crude oil rebounded from early losses.
"This kind of Goldilocks recovery is what people are looking
for," said Rick Meckler, president of hedge fund LibertyView
Capital Management LLC in Jersey City, New Jersey.
MSCI's all-country world index of 45 country
indexes rose 0.7 percent, while the FTSEurofirst 300 of
leading European shares gained 1.3 percent.
On Wall Street, the Dow Jones industrial average was
up 175.32 points, or 1.17 percent, at 15,215.94. The Standard &
Poor's 500 Index was up 16.68 points, or 1.03 percent, at
1,639.24. The Nasdaq Composite Index was up 28.67
points, or 0.84 percent, at 3,452.72.
The euro fell to the day's lows against the dollar
after the jobs report, touching session lows of $1.3193 and was
last at $1.3201, down 0.33 percent.
Against the yen, the dollar gained about 0.2 percent
"This will calm some of the volatility in the markets, as
people were very concerned about an aberrational number in
particular being too strong and how that would aggressively move
the Fed's disposition in terms of tapering," said Rick Rieder,
co-head of Americas fixed income at BlackRock in New York.
But volatility is likely to pick up because of news in
coming weeks about European growth, U.S. economic data and
Japan's direction, he said. The Fed may begin to scale back its
asset purchases moderately some time around September, in line
with market expectations, Rieder said.
German Bund futures pared gains and U.S. government debt
fell in choppy trade on the view the U.S. payrolls data was not
enough to hasten a scaling back in Fed stimulus.
Benchmark 10-year U.S. Treasury notes were down
15/32 in price to yield 2.13 percent.
Bund futures initially fell as low as 143.25 before
recouping those losses. They were last 20 ticks up on the day at
143.65 compared with 143.80 before the data.
Brent futures rose above $104 a barrel, supported by
expectations of ongoing U.S. economic stimulus, putting the
contract on course for its biggest weekly gain since late April.
Brent crude gained 90 cents to $104.51 a barrel,
while U.S. oil rose 98 cents to $95.74 a barrel.