U.S. stocks rose, posting good gains for the week, as a better-than-expected March labor report added to positive sentiment surrounding continued optimism over a U.S./China trade deal. Energy stocks led markets higher, as the trade news and supply shortfalls from countries like Venezuela seemed to boost the sector. Equity news was light, with Tesla again in focus, as the SEC and the company’s CEO looked to resolve their differences over an alleged contempt charge. Treasury yields pared early gains and nudged lower, and the U.S. dollar rose. Crude oil prices moved higher and gold was slightly lower.

The Dow Jones Industrial Average (DJIA) rose 40 points (0.2%) to 26,424, the S&P 500 Index was 13 points (0.5%) higher at 2,893, and the NASDAQ Composite increased 47 points (0.6%) to 7,939. In moderate volume, 775 million shares were traded on the NYSE and 2.1 billion shares changed hands on the NASDAQ. WTI crude oil gained $1.19 to $63.29 per barrel and wholesale gasoline was up $0.03 at $1.97 per gallon. Elsewhere, the Bloomberg gold spot price decreased $0.46 to $1,291.82 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—was 0.1% higher at 97.40. Markets were nicely higher on the week, as the DJIA advanced 1.9%, the S&P 500 Index was up 2.1%, and the NASDAQ Composite gained 2.7%.

Nonfarm payrolls rose by 196,000 jobs month-over-month (m/m) in March, compared to the Bloomberg forecast of a 175,000 increase. The rise of 20,000 seen in February was revised to a gain of 33,000 jobs. The net upward adjustment to January and February was an increase of 14,000. Excluding government hiring and firing, private sector payrolls increased by 182,000, versus the forecasted gain of 178,000, after rising by 28,000 in February, revised from the 25,000 increase that was initially reported. Gains in jobs were most notable in health care, and professional services and employment in food and drinking places saw increases, while other major industries, including mining, wholesale trade and retail were little changed and manufacturing dipped slightly.

The unemployment rate remained at 3.8%, matching estimates, while the labor participation rate ticked lower to 63.0% from February’s 63.2% level. Average hourly earnings were up 0.1% m/m, below projections of a 0.3% gain and versus February’s unrevised 0.4% increase. Y/Y, wage gains were 3.2% higher, south of estimates of 3.7% and February’s unadjusted 3.4% increase. Finally, average weekly hours ticked higher to 34.5 from February’s unrevised 34.4 rate, where it was expected to remain.

Consumer credit, released in the final hour of trading, showed consumer borrowing expanded by $15.2 billion during February, below the forecast of economists polled by Bloomberg, while January’s figure was adjusted upward to an increase of $17.7 billion from the originally reported $17.0 billion. Non-revolving debt, which includes student loans and loans for vehicles and mobile homes, rose $12.2 billion, a 4.9% increase year-over-year (y/y), while revolving debt, which includes credit cards, rose by $3.0 billion, a 3.3% y/y rise.

Treasuries nudged higher, with the yield on the 2-year note flat at 2.34%, while the yield on the 10-year note fell 2 basis points (bps) to 2.50% and the yield on the 30-year bond dipped 1 basis point to 2.91%.

U.S. stocks rode a wave of the best performance since 2009 last quarter to start Q2 higher. U.S./China trade negotiation concerns ebbed and flowed, though optimism over a trade deal added to an overall positive sentiment. The Treasury yield curve steepened slightly, after recession fears were stoked in prior weeks by a key inversion, with the 3-month Treasury yield moving above the yield on the 10-year Treasury. The U.S. dollar nudged higher, as the ISM Manufacturing Index and nonfarm payrolls rose more than expected and showed solid growth, while initial jobless claims figures topped expectations. Also, gold dipped lower and WTI crude oil prices rose for a fifth consecutive week, its longest run of weekly gains since 2017.

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