U.S. stocks rise after solid jobs data; oil down

NEW YORK (Reuters) - Stocks on Wall Street rose on Friday after better-than-expected U.S. jobs and factory survey data, but a gloomy manufacturing report in Japan knocked other global equity markets lower and crude oil prices slumped.

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Nonfarm payrolls increased 215,000 and the unemployment rate rose to 5.0 percent from an eight-year low of 4.9 percent, the U.S. Labor Department said. The jobless rate rose as more people continued to seek work, a sign of confidence in the jobs market.

Still, economists see the data having limited impact on U.S. monetary policy in the near-term after Federal Reserve Chair Janet Yellen’s remarks earlier in the week indicated she favored a cautious stance toward interest rate hikes this year.

“If the economy is getting stronger and Yellen remains on hold, that’s very good for the stock market because that theoretically is inflationary,” said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.

A Reuters poll of U.S. primary dealers showed brokerages still expect the Fed to raise rates twice this year, including a rate increase in June.

The S&P 500 .SPX gained 0.63 percent to 2,072.78. For the week, the S&P ended up 1.8 percent, as U.S. stocks have now recovered all of the losses sustained by markets in the first five weeks of the year.

U.S. crude CLc1 settled down $1.55, or 4 percent, at $36.79. It lost 7 percent on the week. Brent crude LCOc1 settled down $1.68, or 4.1 percent, at $39.09 a barrel. It fell 3 percent for the week. [O/R]

Saudi Arabia will freeze its oil output only if Iran and other major producers do so, Saudi Deputy Crown Prince Mohammed bin Salman told Bloomberg in an interview.

A gloomy Japanese manufacturing report kept a damper on global equity markets. Business sentiment among Japan’s big manufacturers deteriorated to the lowest in nearly three years and is expected to worsen in the coming quarter, a closely watched central bank survey showed on Friday.

The survey heightened pressure on Prime Minister Shinzo Abe and the Bank of Japan to do more to shore up the ailing economy.

Japanese stocks tumbled 3.6 percent to a one-month low.

Shares in Europe also slid to a one-month low, with the pan-European FTSEurofirst 300 index .FTEU3 closing down 1.5 percent at 1,306.69.

MSCI's all-country world stock index .MIWD00000PUS fell 0.48 percent.

The U.S. dollar initially rebounded against a basket of currencies from more than five-month lows on Thursday. The stronger-than-expected U.S. jobs and factory data boosted expectations for a less dovish Fed.

The dollar index .DXY was at 94.591, just above a session low of 94.334. The euro EUR= rebounded, gaining 0.16 percent to $1.1396. Against the yen JPY=, the dollar was last down 0.84 percent at 111.59 yen.

The U.S. benchmark 10-year Treasury note US10YT=RR was unchanged in price, yielding 1.7777 percent.

Reporting by Herbert Lash, additional reporting by Jamie McGeever in London; Editing by Nick Zieminski, Chizu Nomiyama and David Gregorio