UK equities ended the week on a high as mining stocks rallied and the US non-farm payrolls report came in better than anticipated.
A gauge of miners, including Anglo American, Glencore, BHP Billiton and Antofagasta, topped the FTSE 100 as metal prices jumped. Gold prices rose 0.77%, silver surged 3.56% and copper shot up 2.65% on the COMEX.
Oil prices also climbed after official US data showed production fell to its lowest level since November 2014, soothing concerns about the supply glut,Brent crude gained 1.9% to $37.79 per barrel.
While US crude inventories grew to a new record of 517.98m barrels last week, output fell for a sixth straight week to 9.08m barrels a day, according to the US government’s Energy Information Administration.
US jobs report mixed
US non-farm payrolls employment rose 242,000 in February, beating analysts’ expectations for a 195,000 increase, according to the Labor Department. The unemployment rate was unchanged at 4.9% in February, as expected.
While the non-farms surpassed estimates, average hourly earnings fell unexpectedly in February by 0.1% on the month to $25.35. Economists had pencilled in a 0.2% month-on-month rise in average hourly earnings in February following a 0.5% gain in January. On the year, hourly earnings rose 2.2% in February compared to 2.5% year-on-year growth in January and analysts’ forecasts for no change.
Such an upbeat US jobs report raises the possibility that the Federal Reserve will hike interest rates at its 15-16 March policy meeting. However, current signs of rising inflationary pressures and a tightening labour market need to be viewed alongside indications that the pace of economic growth may be slowing, and possibly sharply, amid growing concerns about the outlook.
Gold is at a 13-month high after a 20% rise this year. It was up a hefty $46 on the week, it had touched $1,279 an ounce, it highest level since February 2015.