news/AMZN/2023.02.03/Stocks stumble, U.S. bond yields jump on strong jobs report.txt

*Jan U.S. payrolls 517k vs 185k estimate*Dollar bounces off 9-month lows*Amazon, Alphabet lower after earningsNEW YORK, Feb 3 (Reuters) - A gauge of global stocks
dropped more than 1%, while U.S. Treasury yields and the dollar
shot higher on Friday after a shockingly strong U.S. jobs report
renewed concerns the Federal Reserve may stay aggressive in its
interest rate hike path as it tries to tame inflation.The report from the Labor Department showed nonfarm payrolls
surged by 517,000 jobs in January, well above the 185,000
estimate of economists polled by Reuters, with data for December
also being revised higher. Average hourly earnings increased
0.3%, as expected, down from the 0.4% in the prior month, while
the unemployment rate of 3.4% was the lowest since 1969.Equities have rallied to start the year on expectations the
Fed may be forced to pause or even pivot from its rate hikes in
the back half of the year, growing more confident after comments
from Fed Chair Powell on Wednesday that acknowledged the
"disinflationary" process may have begun. Additional fuel was
added after policy announcements by the European Central Bank
(ECB) and Bank of England (BoE) on Thursday."This make the Fed's job more difficult. Their dependence on
the data yet to come has increased, no doubt," said Russell
Price, chief economist at Ameriprise Financial in Troy,
Michigan."They’re concentrating on the labor market right now, they
want to see labor cost inflation under control, and this report
does not suggest that labor cost inflation in particular is
going to improve significantly anytime soon."Interest rate futures now indicate the Fed is likely to
deliver at least two more rate hikes, taking the benchmark rate
to above 5%.U.S. stocks opened lower after the report, with additional
downward pressure being supplied by a 2.83% decline in Google
parent Alphabet and a 7.70% drop in Amazon after their
quarterly results.Apple, however, helped prevent further declines, as the
stock erased losses in premarket trading to trade 2.74% higher
following its quarterly earnings.Earnings are now expected to decline 2.7% for the quarter
from the year-ago period, according to Refinitiv data, down from
the 1.6% fall expected at the start of the year.Other data showed the U.S. services industry rebounded
strongly in January, according to the Institute for Supply
Management (ISM).The Dow Jones Industrial Average fell 167.55 points,
or 0.49%, to 33,886.39; the S&P 500 lost 44.72 points, or
1.07%, to 4,135.04; and the Nasdaq Composite dropped
176.41 points, or 1.45%, to 12,024.41.Even with Friday's declines, both the S&P 500 and Nasdaq
were on track for weekly gains. The Nasdaq was poised for a
fifth straight week of gains, it's longest since
October-November 2021.European stocks closed modestly higher, erasing earlier
declines on optimism over the region's economy. The pan-European
STOXX 600 index rose 0.34% but MSCI's gauge of stocks
across the globe shed 1.08%. The STOXX index
closed with a 1.23% gain on the week for its highest closing
level since April 21. MSCI's index was on track for a second
straight weekly advance even with Friday's tumble.U.S. Treasury yields climbed after the payrolls report, with
those on the benchmark 10-year note up 13.2 basis
points to 3.530%, from 3.398% late on Thursday, poised for their
biggest one-day jump since Oct. 19.The greenback strengthened in the wake of the data, climbing
off a nine-month low hit on Thursday to 109.92, its highest
since January 12, with the dollar index rose 1.071% and
the euro down 0.93% to $1.0808.The Japanese yen weakened 1.88% to 131.11 per dollar,
while Sterling was last trading at $1.2058, down 1.35% on
the day.Crude prices turned lower in part due to strength in the
dollar and concerns about higher interest rates, with Brent and
WTI poised for weekly declines of about 7%.U.S. crude fell 3.15% to $73.49 per barrel and Brent
was at $79.92, down 2.74% on the day.(Reporting by Chuck Mikolajczak; additional reporting by
Herbert Lash; Editing by Kirsten Donovan and Jonathan Oatis)