World shares hit their highest in over a week on Friday as a slowdown in wage gains in the U.S. helped cool fears about faster inflation and interest rate hikes this year.
The MSCI All-Country World index, which tracks shares in 47 countries was up 0.7% on the day and 2% for the week, having also been buoyed by news that Donald Trump and North Korea’s Kim Jong Un planned to meet by May.
Nonfarm payrolls jumped by 313,000 jobs last month, data from the U.S. Labor Department showed, recording their biggest increase in more than 1-1/2 years. But average hourly earnings edged up only four cents, or 0.1%, to $26.75, a slowdown from the 0.3% rise in January.
oth the benchmark S&P 500 and the Dow Jones Industrial Average each up 1%. “The great news is the labour participation rate went up, the headline numbers are great, and the average hourly earnings has settled back down into consensus,” said Art Hogan, chief market strategist at Wunderlich Securities in New York. Stronger than expected rise in wages last month fanned speculation about faster interest rate rises in the U.S., causing a rout in the bond market and hammering world equities.
The pan-European STOXX 600 index jumped to a session high. It was last up 0.5%, and Britain’s FTSE 100 rose 0.3% to a session high.
Shares in Asia staged sharp rallies after President Donald Trump said he was prepared to meet North Korea’s Kim Jong Un, potentially marking a major breakthrough in nuclear tensions between the two countries.
Japan’s Nikkei rose 0.5% and South Korean stocks gained more than 1%.
