Markets drift despite after US jobs figures

LONDON (AP) — Strong U.S. job creation in April failed to boost stocks on Friday as the figures cemented expectations the Federal Reserve will continue to reduce its monetary stimulus in the months ahead.

Government figures showed the U.S. created 288,000 jobs in the month, around 70,000 more than anticipated, and the unemployment rate fell to a five-and-a-half year low of 6.3 percent. "Not only did the headline beat expectations by a mile, but there were also upward revisions to the prior 2 months, and the unemployment rate unexpectedly plunged to a fresh post-crisis low," said Michael Woolfolk, an analyst at Bank of New York Mellon.

Analysts said the figures more than justified the decision by the Fed earlier this week to continue to reduce its stimulus in the wake of much lower than anticipated first quarter growth following bad weather across large parts of the country.

As a result, investors concluded that the jobs data, though encouraging on the growth front, would mean that the so-called "tapering" will continue and that the first rate hike in the cycle may come sooner than predicted.

In Europe, the FTSE 100 index of leading British shares rose 0.2 percent to close at 6,822.42 while the CAC-40 in France fell 0.7 percent to 4,458.17. Germany's DAX fell 0.5 percent to 9,556.02. In the U.S., the Dow Jones industrial average was down 0.1 percent at 16,547 while the broader S&P 500 index rose 0.1 percent to 1,884.90.

The jobs data gave a temporary boost to the dollar, which fell back down to trade flat against the Japanese yen, at 102.34 yen. The euro, meanwhile, was down 0.1 percent at $1.3861. Earlier, in Asia, Japan's Nikkei fell 0.2 percent to finish at 14,457.51, as market players remained cautious ahead of a four-day weekend. Monday and Tuesday are national holidays in Japan. Elsewhere, Hong Kong's Hang Seng added 0.6 percent to 22,260.67.

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