US stock index futures jump after weak jobs report

AP News
Posted: Sep 06, 2013 8:57 AM
US stock index futures jump after weak jobs report

NEW YORK (AP) — U.S. stock futures gained ground Friday after the government's August unemployment report showed a slowdown in hiring, which could mean the Federal Reserve will delay any reduction in its monthly bond purchases.

The bond purchases are a key part of the Fed's economic stimulus program.

Dow Jones industrial futures rose 70 points, or 0.5 percent, to 14,987 a half-hour before regular trading was set to begin. S&P 500 index futures rose nine points, 0.6 percent, to 1,661. Nasdaq futures rose 16 points, 0.5 percent, to 3,144.

The yield on the 10-year Treasury note fell to 2.88 percent shortly after the report was released. It was 2.96 percent just before the report came out, and traded as high as 3 percent Thursday, its highest level in two years.

The Labor Department said U.S. employers added 169,000 jobs last month, below the gain of 177,000 jobs predicted by economists. It also revised the number of jobs added in July downward to 104,000, from its previous estimate of 162,000.

The Federal Reserve meets Sept. 17-18, and many economists expect the Fed to decide then to slow its monthly bond purchases. The weaker-than-expected data could mean the panel puts off that decision, a factor that is pushing markets higher.

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The unemployment rate edged down to 7.3 percent, but the decline mainly reflects more Americans giving up on looking for work, which means they are no longer counted as unemployed. The proportion of Americans working or looking for work fell to its lowest level in 35 years.

Overseas markets also edged higher. Britain's FTSE 100 gained 0.2 percent to 6,546. Germany's DAX rose 0.2 percent to 8,246 and France's CAC-40 rose 0.4 percent to 4,025.