Stocks mixed as US jobs data fuels hope of rate hike pause

NEW YORK (AFP): Global stocks diverged Friday, with the latest jobs report in the United States helping to solidify expectations of a pause in US interest rate hikes.

An increase of 187,000 jobs in August was slightly larger than analysts expected, but the figures for the previous two months were revised significantly lower which, overall, indicated a slowdown in the job market. Moreover, wage growth cooled.

Briefing.com analyst Patrick O’Hare called it “a Goldilocks report as it pertains to the market’s thinking that the Fed won’t be raising rates again.” A separate survey showed the slump in US manufacturing activity continued for a 10th consecutive month in August amid ongoing softness in new orders.

Friday’s reports followed a series of data showing signs that the world’s top economy is cooling, easing pressure on the Federal Reserve to lift interest rates further to fight inflation.

“This would suggest we’ve probably seen the last of Fed rate hikes for this economic cycle, with the narrative now likely to shift to when we can expect the first rate cut,” said market analyst Michael Hewson at CMC Markets. Wall Street’s main stock indices mostly advanced, with the Dow ending 0.3 percent higher and the S&P 500 up 0.2 percent.