(Reuters) – Asian stocks basked in the glow of a record close on Wall Street after bright U.S. jobs data pointed to improving economic momentum, while the dollar gained on Monday on rising U.S. Treasury yields.
U.S. jobs data on Friday showed that nonfarm payrolls increased by 217,000 last month, bringing employment back to its pre-recession level and validating the view that labor conditions are improving. The unemployment rate held steady at a 5-1/2 year low of 6.3 percent. (Full Story)
MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was up about 0.2 percent, while Japan’s Nikkei stock average .225 added 0.7 percent in early trading
The Dow Jones industrial average .DJI and S&P 500 .SPX ended at new records on Friday. For the week, the Dow, the S&P and the Nasdaq Composite .IXIC all added more than 1 percent, with the Nasdaq rising 1.9 percent.
The yield on benchmark 10-year Treasuries US10YT=RJR stood at 2.598 percent, steady from Friday’s U.S. close of 2.597 percent and well above 11-month lows plumbed last month.
By contrast, Italian, Spanish and Irish bond yields fell to record lows on Friday, a day after the European Central Bank unveiled a package of easing steps.
“The yield on 10-year U.S. Treasuries may need to sustain a move back above [the] 2.6 percent area to increase the likelihood of the greenback move through the 102.80 level against the yen,” Marc Chandler, global head of currency strategy at Brown Brothers Harriman, said in a note to clients.
For now, the dollar had to be content with a 0.2 percent gain to buy 102.64 yen JPY=, getting some help from Japanese current account data released early on Monday.
Japan posted a lower-than-expected surplus in April, as income gains from overseas investments narrowed and the trade deficit widened. Still, it marked the third consecutive month of surpluses. (Full Story)
Other data on Monday showed Japan’s economy grew 1.6 percent in January-March from the previous quarter, revised up from a preliminary 1.5 percent expansion due to faster growth in capital expenditure. (Full Story)
The euro also gained on its Japanese counterpart, edging up 0.2 percent to buy 140.07 yen EURJPY=R, testing its highest levels since mid-May.
Against the greenback, the euro EUR= was steady on the day at $1.3647.
In commodities trading, U.S. crude CLc1 gained about 0.1 percent to $102.72 a barrel, underpinned by the solid jobs report that pointed to an improving economy and suggested that oil demand will increase.
(Editing by Shri Navaratnam)