Shares plunge on strong jobs report and curiosity fears

Shares plunge on strong jobs report and curiosity fears

The unemployment rate stayed unchanged at a 17-year low of 4.1 percent.

"It feels as though the grand era of interest rates below 3 percent will soon be in the rear-view mirror", said Mike Terwilliger, portfolio manager of Resource Liquid Alternatives for the Resource Credit Income Fund in NY.

The spike in bond rates made everybody nervous, said Gary Bradshaw, portfolio manager at Hodges Capital Management in Dallas. "The government has cut taxes and it's borrowing more - maybe we're going to see inflation".

Art Hogan, chief market strategist at Wunderlich Securities in NY, said next week investors will kick themselves for selling assets for all the wrong reasons in a sell-off akin to throwing the baby out with the bath water. "We sold financials because interest rates are going higher?'"

Major stock indexes dropped sharply Friday, with the Dow Jones industrial average tumbling 666 points amid signs that wage growth is finally picking up.

The S&P 500 Index fell 2.1% to 2,761.91 at 4 p.m.in NY. Facebook rose 3.5 percent after the company forecast rising ad sales, despite a dip in usage on the social media network.

With the Federal Reserve already in the midst of a rate raising cycle - it is tipped to hike at least three times this year - there is increasing concern about the impact on world markets.

The S&P 500 index showed 18 new 52-week highs and 18 new lows, while the Nasdaq recorded 34 new highs and 77 new lows.

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"It's all about the bond market, the bond market is calling the tune for stocks and has been all week".

Alphabet fell 5.0 per cent after the Google parent's fourth-quarter profit came in below consensus on increased spending. Disappointing results from companies including Deutsche Bank AG and BT Group Plc. paced losses, with Germany's DAX giving up the year's gains, capping the worst weekly decline since 2016.

The pan-European FTSEurofirst 300 index .FTEU3 of leading regional shares closed down 1.37 percent and the blue-chip FTSE 100 .FTSE index in London closed down 0.63 percent.

The Nasdaq Composite was up 7.84 points, or 0.11 percent, at 7,419.32.

That improvement has also led central banks to temper their crisis-era stimulus measures, which has led to a rise in bond yields, including the key US Treasury market.

The Japanese yen declined 0.4 percent to 109.88 per dollar. The gap between 10-year Treasury Inflation Protected Securities (TIPS) and 10-year Treasury notes reached its widest since September 2014.

West Texas Intermediate crude gained 0.1 percent to $65.86 a barrel, the highest in a week.

Tokyo ended 0.9 per cent down while Singapore shed 0.2 per cent and Seoul dived 1.7 per cent. Hong Kong, which in January chalked up a series of records, finished down 0.1 per cent.

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