US jobs data boosts Asian stock markets

HONG KONG – Asian stock markets rose on Friday after strong US jobs figures stoked hopes that the recovery in the world’s number one economy is back on track.

An expected hike in interest rates by the European Central Bank (ECB) also provided some support for the euro.

Hong Kong rose 1.05 percent, Tokyo added 0.98 percent by the break and Sydney gained 0.97 percent while Taipei climbed 0.48 percent. Shanghai and Seoul were flat.

Investors began the day on a bright note after encouraging US employment data from payrolls firm ADP, which said private non-farm businesses added 157,000 jobs in June, a solid jump after the weak 36,000 increase from April to May.

The welcome numbers lifted hopes that eagerly awaited government employment figures – seen as a barometer of the overall economy – will also show big gains after some anaemic results over the past few months.

“All eyes will be on the US job report Friday,” Credit Agricole said in a note to clients, according to Dow Jones Newswires.

“Markets could take a respite from the worries over the soft-patch temporarily on the likely solid number” indicated by earlier positive data from the United States.

Wall Street rallied, with the Dow up 0.74 percent, the broader S&P 500 1.05 percent higher and the tech-heavy Nasdaq up 1.36 percent.

Adding to the buying strength was a report showing US chain-store sales jumped 6.9 percent in June from a year earlier, according to the International Council of Shopping Centers.

The euro was given support by the ECB decision to raise interest rates 0.25 percentage points to 1.50 percent as it tries to battle inflation.

The single currency was also helped by bank president Jean-Claude Trichet, who signalled another increase could be in the offing later this year if prices continue to rise.

In early Tokyo trade the single currency was at $1.4357, from $1.4356 in New York overnight and much stronger than $1.4324 in Asia on Thursday.

It was also at 116.66 yen from 116.62 in New York Thursday and 115.92 in Asia earlier in the day.

The dollar edged up to 81.23 yen in early Tokyo trade from 81.20 yen in New York.

On oil markets New York’s main contract, West Texas Intermediate for August delivery, rose three cents to $98.70 a barrel and Brent North Sea crude for August dropped 45 cents to $118.14.

Gold opened at $1,530.00-$1,531.00 an ounce in Hong Kong, slightly down from $1,530.80-$1,531.80 at the close on Thursday.